As the coffee industry increasingly explores digital payments, it is essential to consider the experiences of coffee farmers and how this shift towards digitization affects their lives and livelihoods, taking into account the context of each country. By highlighting the voices of farmers, we aim to help stakeholders in the coffee value chain better understand whether and how digital payments and greater financial engagement can support their goals. Our objective is to encourage them to actively participate in responsible digital payment practices throughout their supply chain.
Caravela Coffee, a specialty coffee exporter in Colombia, connects small-scale farmers with global markets through a focus on quality, transparency, and sustainability. Caravela supports farmers by paying them directly through bank transfers. 60 Decibels conducted phone surveys with 279 coffee farmers. The farmers were selected from a contact base of 1,003 farmers who had been paid by Caravela in the most recent season using a random sampling approach.
A typical farmer has been receiving bank payments from Caravela for 2 years, primarily through Banco Agrario or Banco de Bogota. 4 in 5 farmers had access to a bank account before working with Caravela. 73% report actively using their bank account in the last 30 days, mainly to receive payments and withdraw cash and a quarter actively use digital wallet apps such as Nequi or Daviplata. More than half do not use any financial tools other than their bank account.
A typical farmer receives payments from Caravela in their account after 7 days of selling their coffee but expects it to arrive in 3 days time. A third of them expect it within one day. Despite this, 75% of farmers rate the payment timeliness positively; those saying this is ‘very good’ typically receive their payment on their expected day without delays.
3 in 5 farmers prefer receiving payments via bank transfers, primarily due to the security of the transactions. However, 27% still prefer cash in order to immediately access the entire payment and the time savings incurred by skipping the withdrawal process.
In the most recent season, 3 in 4 sold their coffee to alternative buyers, primarily other companies and cooperatives. 61% of farmers were paid in cash by their alternate buyer, with a quarter reporting bank transfers. Resultantly, nearly all payments from alternate buyers were received within a day or at the point of sale. Owing to the timeliness and speed of payments, nearly half of all say their experience with the alternate buyer is ‘better’ or ‘much better’ compared to Caravela.
Among the 11% of farmers reporting challenges with their payment experience with Caravela, the majority talk about delays or poor communication around the payment. This is in line with farmers’ top suggestions for improvement as well – faster payments and receiving notifications from Caravela. Half of the farmers received a custom SMS from Caravela regarding the deposit status. But 27% only received a bank notification, and 20% were not informed about their deposit status.
Less than 1 in 5 farmers report using their bank account for saving cash. When explicitly asked whether a bank account has impacted their savings, 55% report ‘no change’. 65% also say that there has been no change in their level of worry about finances. However, among farmers who have experienced several transactions from Caravela, a higher proportion talk about more savings and decreased stress levels, potentially highlighting the role of prolonged use.
