Colombia’s Coffee Growers Smart ID Card: Successfully Reaching Rural Communities with Digital Payments

This case study evaluates the performance of Cédula Cafetera Inteligente, a pre-paid card tailored exclusively to the needs of coffee farmers in Colombia. The card allowed coffee farmers to be paid for their coffee as well as government benefits through ATMs and special point-of-sale devices. The study states that prior to the development of this card, there were many challenges that were incurred in making payments to coffee farmers due to rising risks and costs of transporting cash. The study examines this shift from cash to cashless payments and discusses the development of the pre-paid card. It highlights the outcomes of the transition and the various challenges that were incurred during implementation. The case study also presents lessons for organizations considering similar closed-loop, prepaid card payment mechanisms. Lessons include:

• Digitizing the payments to farmers using the card scheme can provide significant cost savings;
• Establishing a functioning digital channel allowed other payment types, especially government subsidies and credits, to flow to small farmers;
• Convincing end users to digitize their own payments at merchants rather than simply cashing out takes more time and effort;
• Rural areas may require stronger incentives for both acceptance and usage.