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Abstract
This study contributes to pioneering literature on the impact of mobile phone-based
money transfer, especially in agriculture. It provides information regarding financial
intermediation to the excluded through the use of new generation Information Communication
Technology (ICT) tools, especially the mobile phone. The study employs
propensity score matching technique to examine the impact of MMT services on
household agricultural input use, agricultural commercialization and farm incomes
among farm households in Kenya. It uses cross-sectional data collected from 379
multi-stage randomly selected households in three provinces of Kenya. The study
found that use of mobile phone-based money transfer services significantly increased
level of annual household input use by $42, household agricultural commercialization
by 37% and household annual income by $224. We conclude that mobile phone-based
money transfer services in rural areas help to resolve a market failure that farmers
face; access to financial services. We discuss implications for policy and practice.