Cocoa payment


Last Updated on July 29, 2020 by Nick Baskett

Updated 22 July, 2020

World Cocoa Foundation (WCF) and the UN-based Better Than Cash Alliance are focusing on the need to drive digital payments for farmers operating in Ghana’s cocoa market.

The latest WCF report has highlighted the issue of only 10% of payments being made digitally for farmers in Ghana’s cocoa sector. However, 90% of farmers now own mobile phones, which can be used to enable digital payments, according to the latest research.

Digital financial services represent a powerful opportunity to deliver on our vision of a sustainable and thriving cocoa sector,

RICK SCOBEY, President, World Cocoa Foundation

The report makes the case that there are core benefits to digitisation, which includes

  • Shortening the operating cycle
  • Making it safer for those handling cash
  • Reducing interest costs
  • Increasing transparency

According to the report solving the issue of enabling far more digital payments to farm communities and educating people at the sharp end of the industry on this is necessary to help raise their standards of living.

Editors note. Something often not taken into account with cashless schemes is that locals will often have to pay suppliers in cash. Some countries (my experience of this is outside of Africa) banking systems are so restrictive that withdrawing cash to pay a supplier is just not possible – invoices are required and transactions are scrutinized.

In these environments, businesses are forced to take cash payments, so they can pay a supplier, who insists on working in cash. Where restrictive banking conditions and government controls like this exist, initiatives like this one will have an uphill battle.

Reading more about the results in Ghana, however, the scheme seems to be having a positive impact.

In the Côte d’Ivoire, many farmers are obliged to work for payments below UN definitions of poverty, which can only be addressed through securing basic levels of pay that are raised wholesale.

This is one of the areas where making payments transparent through a tracked digital platform can assist in enhancing farmers lives.

Over 90% of farmer-level transactions in Ghana take place in cash, representing more than GH¢7 billion, or US$1.26 billion of payments annually.

Digitizing Payments in Ghana’s Supply Chain

On the Better than Cash website, there is a reference to a story that gives an example of how this works. Samuel takes his crop to the Licensed Buying Company (LBC) and gets paid immediately to his digital wallet, that he keeps on his phone.

Since not cash is involved, the clerk is less likely to get robbed, while Samuel is able to send money immediately to his kids if they need something at school. He also says that not having cash in his pocket means he tends to save more – something we can probably all relate to.

The LBC has a lot to gain from digitisation. The Better than Cash alliance estimates in this report that costs and risk of cash to the cocoa sector are valued at more than $20 million every year, or more than 20% of turnover for all LBCs.

Cocoa prices have taken a notable hit amid the COVID-19 pandemic within West Africa, which compounds an existing issue. Initiatives like this one that can contribute to improving farmers profitability are welcome.

Further work will be required to enable farmers access to digital markets for other supplies and goods that provide them with an adequate incentive to transition to consider going online.

As noted by the WCF for many rural farming communities in Ghana that form the cocoa sector’s foundation, digital and financial literacy may not be exceptionally high. Still, with a sustained education programme, improvement can be made that does not require high levels of technological investment.

A practical payment system based upon the already high use of mobile phones may have a transformative effect if enough communities can be convinced of the positives of making such a move.

Article Update:

We received an email from a reader who felt it was important to stress that the dangers of abuse and corruption when dealing in cash were real and a digital platform was a superior approach. I have added a summary of their comments here:

I am the Founder/CEO of Help farmers Cameroon that is an agritech web/mobile app company leveraging on technology to improve quality and quantity.

I want to say that I have been in the field as a farmer then ffs facilitator then internal inspector for utz certification. With all this experience that is why I started my own company.

Digital payments is the ideal in the cocoa sector to curb corruption of farmers money. You need to go around and talk to farmers about premium payments u will understand what I am saying.

The money goes back to the workers of the company leaving the farmers empty. During the cocoa season the farmers who got no management skills lavish the money without any plans. So we at Hefarcam introduce digital payments and back payments and still looking for innovative modes of payments to curb corruption and fraud in the cocoa sector.

We pay our farmers through banks and with this banks can give them loans to diversify their agriculture. Those without bank account we pay them through mobile money payments. More information at

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