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By Wesley Langat
MACHAKOS, Kenya, Oct 23 (Thomson Reuters Foundation) - For the past two years, Beatrice Ndavi, a 56-year-old farmer in central Kenya, has received vouchers for good-quality seeds and fertiliser, as well as training to improve her yields.
The support is offered on credit as part of an insurance scheme that provides security for the farmer's loan by paying it down if her harvest is damaged by extreme weather.
Ndavi, a mother of six from Masii village in Machakos County, explained that in the past, farmers ended up taking out cash loans to cover their needs in an emergency, which they then struggled to pay back.
But under the Risk-Contingent Credit (RCC) scheme she is part of, it has become easier for her to keep going, even if the weather is bad, she said.
"I get the right farm inputs - quality seeds and fertilisers on time - and I'm not worried about how to repay the loan as it's insured," she told the Thomson Reuters Foundation.
RAIN-BASED PAYOUTS
Millions of rural households in Kenya rely on agriculture for their income, but a warming climate is bringing more intense and frequent droughts, disrupting production.
Recurring losses due to sometimes consecutive years of drought, coupled with the high cost of certified seeds and other inputs, have made poor farmers reluctant to invest in their land, organisations working on the RCC project found.
Apurba Shee, lead researcher with the Natural Resources Institute at Britain's University of Greenwich, said the credit scheme differs from traditional insurance as it takes into account rainfall patterns as they unfold rather than paying out only when harvests fail.
Remote-sensing satellite technology is used to track rainfall in real-time, and if the average drops below a set threshold in any 21-day period during the growing season, it triggers digital payouts that cover farmers' loans.
The system allows for multiple payments spread throughout the season, as rain volumes fluctuate, Shee said.
The RCC programme aims to tackle both credit constraints and risks linked to drought, he said in an interview.
"We are getting clear positive indications in term of increased farming investments (and) farmers going back to farming more often, even after a devastating drought," he added.
According to a 2018 survey, nearly 1,200 farmers in Machakos had enrolled in the RCC scheme, with 40% taking out insured loans to buy farm inputs.
The average amount they received was 8,500 Kenyan shillings ($82), compared with 6,000 shillings ($58) for traditional loans.
In the neighbouring county of Embu, about 800 farmers are taking part in the U.S. government-backed project.
Shee said the RCC scheme had now proved itself to be commercially viable and had the potential to be expanded to other parts of Kenya and semi-arid regions across southern and eastern Africa, as well as along the borders of the Sahara.
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