By Francis Kamande a coffee auction expert
Farmers across the coffee belt are seeking the registration of new players to provide Direct Settlement System (DSS) to satisfy the expanding coffee sector in Kenya.
With the increased clamour for recruitment of a second player as an alternative to the Cooperative Bank of Kenya, the farmers say Coffee Regulations of 2019, are yet to be meaningful owing to the delays by the DSS in the remittance of their proceeds.
In a spot check by The Mountain Journal across Mt Kenya and Eastern Region, the stakeholders say there is dire need for the regulators in the industry, Nairobi Coffee Exchange (NCE) and Capital Markets Authority (CMA) to provide them with alternatives.
The growers allied in the cooperatives and estates indicate their suffering under the DSS coupled by delayed payments and lack of information.
In May this year, when the NCE conducted farmers sensitisation forums in the coffee belts, the farmers expressed reservations on the performance of the DSS calling for appointment of other players in the banking sector to offer the services.
Rachel Momonyi says the payment system in the sector remains well thought of but farmers are denied opportunity to make decisions on the deductions by millers, transporters among other needs .
Momanyi said it was the best time for the farmers to evaluate the performance of the DSS in the first year.
“ As we proceed to the second year we demand the government initiate a process to recruit another player,” said Momanyi.
Another farmer and a woman leader in Ruiru, Ms Veronica Nyambura say appointment of two more players will ease the challenges the growers are facing.
“ We implemented the DSS through try and error but we have established the challenges that must now be resolved through appointment of additional players to complement the cooperative bank,” said Nyambura.
James Kibor Moiben an estate manager in Kericho county say he was concerned on the delay in communication with the DSS department.
“We are tired of a single institution providing services thus needed for recruitment with an alternative. If the regulators want to assist the farmers there should be four players providing the DSS services to the thousands of the cooperatives and estates,” said Moiben.
Francis Muthui, a farmer Kangunu farmer society in Mathioya, says the impact of coffee reforms has not been felt owing to several bottlenecks in the regulations thus need for an additional player for checks and balances.
At the society, he reveals the details on DSS new to the members as the management committee safeguard information pertaining payment rates.
“The farmers need to be free and have access to information pertaining to his finances, The DSS has been a major let down in the industry thus needing for recruitment of other players,” said Muthui.
Kenya Coffee Producers Association Chairman Peter Gikonyo pleads with the government to consider recruiting three additional players to provide the DSS services in the lucrative coffee sector.
Gikonyo said the DSS platform needs to be enhanced to provide effective services to the farmers, and for the farmers to achieve the results .
“ There is a big gap between DSS and the estate farmers who have been claiming to have been left out,” said Gikonyo.
Harrison Chege, chairman at Gatagua farmers Cooperative Society , says the DSS should be scrapped as it has failed to add value to coffee farming.
In the farmers meetings, the issue of payments emerged and it emerged that the majority of the farmers are not conversant with the DSS system in payment.
‘The facility is a mere rip off as the farmers’ proceeds should be credited directly in the accounts after the sale is completed.’ said Chege.
He adds that in most of the times remittance of proceeds from the DSS to the society bank accounts take longer.
“ Gatagua society sold its coffee when the dollar rate was exchanged at Sh130 but we got less money,” said Chege.
