Meet the Entrepreneurs
MkulimaBima November 2013
Mobile Innovation
CONTACT INFORMATION
mkulimabima
Nairobi, Kenya
Improving transparency and facilitating faster processing of farmers’ insurance claims
+254729225710
info@mkulimabima.com
www.mkulimabima.com @MkulimaBima
Joseph Mwangi, CEO, Kenya
CHALLENGE Kenya is home to around six million people who make a living working on small farms. Their crops are frequently affected by bad weather and the farmers are threatened with losing their entire harvest. Most farmers also lack sufficient funds to buy new seeds to continue with the harvest season after these weatherborne setbacks. Though there are around forty insurance companies operating in Kenya which are able to secure farmers’ crops, difficulties arise when trying to connect the two. Farmers are located in rural areas and most insurance companies are based in big cities. Hence, it is challenging for farmers to reach out to insurance companies and difficult for the companies to provide adequate services due to high mobility costs. When a claims process takes too long, the damaged crops cannot be replaced by new seeds in time to continue with the harvest. Additionally, the insurance companies lack the technological infrastructure for effective service innovation.
“THIS IS A CHAIN REACTION: THE FARMERS LACK THE MONEY TO BUY SEEDS TO REPLANT THEIR CROPS, MEANING THEY CANNOT START THE HARVEST ANEW.”
BUSINESS MODEL Since its creation in 2011, MkulimaBima has developed three main services for the mobile application: providing valuable information and data regarding different insurance and agriculture-related topics to farmers, a platform for farmers to track their insurance status, and a tool for insurance companies to collect data on farmers more efficiently. However, as the company is still running in its pilot phase, the only services available are those related to providing information to farmers. MkulimaBima has four permanent staff working at the office and five agents who conduct field visits to collect the necessary data. The revenue model is a subscription-based system for farmers and insurance companies, as well as advertising. Each time the farmer sends an SMS through the platform, they will be charged 10 Kenyan Shillings (USD0.12). MkulimaBima buys bulk messages from mobile operator Safaricom for two Kenyan Shillings (USD0.02) per SMS and has a margin of eight Kenyan Shillings (USD0.092) for each SMS sent. Additionally, five agribusiness providers (seeds, fertilizers, etc.) are advertising their products via SMS to the farmers subscribed to MkulimaBima. In 2013, 2,000 farmers subscribed to the platform, allowing the company to generate its first revenue. Two insurance companies will be incorporated into the system in 2014.
IDEA Being part of an extensive family of farmers, co-founder Joseph Mwangi is aware of the difficulties and hard work that farming brings. Together with Daniel Murithi, he worked on how to bring solutions that could address farmers’ needs in remote areas of Kenya. After participating in a series of specialized agriculture conferences and seminars where they met a number of farmers and exchanged personal experiences, the founders came to the conclusion that the main challenge they should focus on was getting the farmers’ crops insured. Since most of the farmers have low-end mobile phones, they decided to invent a service that would allow farmers and insurance companies to track compensation claims in real time via SMS.
“MKULIMABIMA STANDS FOR ‘INSURED FARMER’ IN SWAHILI - THE IDEA IS TO ACCELERATE THE CLAIMS PROCESS BETWEEN FARMERS AND INSURANCE COMPANIES.”
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