New CGAP Report: Smallholder Diaries

New CGAP Report Provides Unique Insights into the Financial Lives of Smallholder Families

WASHINGTON, D.C., February 25, 2015 - A new CGAP report released today documents the financial lives of a select group of smallholders in three countries, offering a unique window into the struggles, risks and trade-offs they face on a daily basis. The report also provides recommendations on the types of financial services that could improve the lives of this important group of people.

There are an estimated 500 million smallholder households (approximately 2 billion people) around the world. These small-scale farming families make up a significant portion of the world’s poor who live on less than two dollars a day. Until now, little was known about their financial lives.

CGAP’s "Financial Diaries with Smallholder Households" fills this information gap through a year-long study tracking the income, expenses, and agricultural production of 270 smallholder families in Mozambique, Tanzania, and Pakistan. Approximately 500,000 data points shed light on how these households manage their money and face challenges from climate shocks to unexpected health issues.

Jamie Anderson, Financial Sector Specialist at CGAP states: “Financial service providers and others working with small-scale farming families need to know how diverse this market is. Insights from the Smallholder Diaries can help them tailor solutions to the various profiles of smallholder households.”

The report offers market-specific recommendations. These range from financial tools aimed at improving agricultural production and crop storage in the Mozambique sample, which was comprised of mainly non-commercial smallholders; diversified savings instruments for the households in Tanzania, who sold more agricultural products than they consumed; and tools for facilitating relationships with middlemen in the Pakistan study, who sold nearly all of their agricultural products.

While the methodology and sample size are not statistically representative of smallholder families in a given country, the findings from this study are broadly representative of the various types of smallholders around the world.

Download the Report and Explore the Interactive Data Visualization

The research revealed several critical risks facing smallholder families. These include:


  • Weather-related shocks dealt major hardships to smallholder families. For instance, 72% of the households in the Pakistan sample had 25% or more of a crop destroyed by weather in the past five years.


  • Smallholders faced common health shocks that not only depleted household financial, emotional and human resources, but also disrupted agricultural activities. In Mozambique, for example, 70% of the families in the study experienced the death of a household member in the past five years.


  • Use of digital financial tools in the Smallholder Diaries was very limited. Only 19% of Smallholder Diaries families in Tanzania used mobile money in Tanzania, the only country in the study where smallholders reported any mobile money usage.


  • Many Smallholder Diaries households had no specific tools for coping with shocks. When crops were destroyed by weather, for instance, 72% of Tanzanian households did nothing in response, demonstrating a lack of fallback options.


  • Some smallholders faced risks associated with basic agricultural practices. For example, in Mozambique, 61% of the households reported losing crops in storage due to infestation by pests.


  • For some households, market fluctuations presented another layer of risks. The households in the Pakistan study sold nearly all of their agricultural production. Nearly all of these households were significantly impacted by either an increase in the price of inputs (99%) or a decrease in the selling price for their crops (96%).

About CGAP

CGAP is an independent think tank that works to empower poor people to capture opportunities and build resilience through financial services. We test, learn and develop innovative solutions through practical research and active engagement with our partners on building responsible and inclusive financial systems that help move people out of poverty, protect their gains and advance global development goals. Housed at the World Bank, CGAP is supported by over 30 leading development organizations committed to making financial services meet the needs of poor people.