Kenya Tea Development Agency (KTDA) has partnered with Safaricom to roll out a cashless payment solution across the country, a move that will boost efficiency in factory operations.
The partnership will see all payments for tea at the factories made to a unique till number assigned to each payment point. Once the FDS transactions are initiated they will be approved by the factory management instantly before being pushed to the Treasury Department, where the revenues will be recorded and sale approvals given.
This initiative is set to reverse the cash payment system which is prone to insecurity, time consumption and ineffectiveness especially during bonus payments. Initially, farmers have been forced to endure long queues to collect their money at their respective factories with many losing their earnings to thieves who trail them.
“The adoption of M-PESA as the sole payment option at our factories lowers the overall inherent cash handling risks and will increase accountability. This move will translate into significant savings and better revenue management, which will in turn lead to increased returns,” said Mr. LerionkaTiampati, Chief Executive Officer, and KTDA.
He explained that the adoption of the cashless system does not only represent a technological convergence that provide much required solution but also underpins KTDA’s quest to be innovative in order to add value to its shareholders and help boost the county and national economy.
Speaking during the launch, Safaricom CEO Bob Collymore said that his firm will continue to partner with stakeholders in the agricultural sector to come up with solutions to problems facing farmers. He acknowledged the role of agriculture in the country’s economy saying that the mobile money will effectively serve majority of farmers especially in rural areas who lack banking services.
“We believe this initiative will transform the entire payments cycle for farmers and KTDA factories. As we continue to deepen M-PESA’s utility beyond person-to-person payments, this partnership demonstrates the ability of the service to provide an efficient payments channel for industries,” said Bob Collymore, Chief Executive Officer Safaricom.
The initiative comes at a time when tea farmers across the country are recording looses rising from theft especially during the bonus season. According the Authority, one out eight of its members loss the collected cash to thieves. Last year, the agency distributed Sh19.8 billion in bonuses to it’s over 600, 0000 members across the country.
54 KTDA factories have already started collecting revenues through M-PESA, with positive impact on their operations. The remaining 12 factories will go live in the coming months.
KTDA has in the recent past adopted various innovative technologies such as fibre Internet and Electronic Weighing Solutions that are geared at enhancing the performance of the Agency. Technology at the Agency has been adopted in all departments including procurement and human resources and the attendant efficiency will result in benefits to farmers.
“KTDA began rolling out this process in July last year and we are proud of the enthusiasm with which this and other factories have adopted this system,” said Kangaita Factory Chairman, David Githinji. They spoke during the official launch of the system at Kangaita Tea Factory in Kerugoya, reputed to be the home of specialty teas owing to its production of the purple and white tea varieties.