The Reserve Bank of Malawi (RBM) and German Sparkassen Stiftung for International Cooperation have stepped up efforts to equip smallholder farmers with financial and business management skills, citing low financial literacy as a major barrier to accessing agricultural credit.
The initiative, supported by the United Nations Development Programme (UNDP) and funded by the European Union (EU), is training facilitators who will, in turn, deliver financial literacy lessons to farmers across the country.
Speaking in Lilongwe during the launch of the training-of-trainers programme, German Sparkassen Stiftung regional coordinator Markus Tacke said the organisation has been working in Malawi since 2019 to help farmers manage their farms as profitable businesses.
“It is not only about knowing how to farm, but also understanding farming as a business, growing the farm as a business and moving beyond subsistence farming,” he said.
Tacke said the foundation, the development arm of the German Savings Bank Group, uses business simulation games to teach financial management, planning and decision-making.
RBM financial inclusion and financial literacy programmes manager Madalitso Chamba said inadequate financial literacy continues to prevent many smallholder farmers from qualifying for loans.
“When farmers approach a bank for credit, they are asked to provide financial records. Most farmers do not have the necessary records, making it difficult for financial institutions to assess their creditworthiness,” she said.
Chamba said the programme aims to strengthen record-keeping, help farmers understand production costs, identify profitable markets and manage their farms as sustainable businesses.
The initiative forms part of broader efforts by RBM, the UNDP, the EU and other partners to promote financial inclusion and strengthen the resilience of Malawi’s agricultural sector.
