Suresh Dumbre’s day starts with a text message on his mobile phone. The message, in Marathi, usually comes at 7 am. The 40-year-old vegetable farmer in Dawadi village in Pune reads it aloud: Cabbage. Pune: Rs 64 for 10 kg. Mumbai: Rs 80 for 10 kg. Kolhapur: Rs 80 for 10 kg. Now, Dumbre knows how much his cabbages will fetch him in the nearby wholesale markets. He leaves home with his stocks only after reading the message.

This is a social enterprise initiative. We wanted to take a lead in offering market solutions that have an impact on the society, and yet, are profitable.— Amit Mehra, Managing Director, RML

Every day, at seven, 100,000 farmers in Maharashtra, Haryana and Punjab receive similar messages tailor-made to their specific crop and market requirements. Each of them has paid an average of Rs 50-Rs 100 a month for this service. Reuters Market Light (RML), the SMS-based information service targeted at farmers, was launched two years ago by the $13.4 billion Thomson Reuters Group. “We expect subscriber numbers to touch one million in three years,” says RML’s Managing Director, Amit Mehra.

Last Thursday was an eventful day in Dumbre’s life. He sold his cabbages at Rs 88 for 10 kg, the highest price they have ever fetched him. Later that evening, at the Sarpanch’s office, he describes his experience to others over a cup of chai: A 10 kg sack of cabbages used to fetch him just Rs 25, and if he was really lucky, Rs 35. “I was at the mercy of middlemen who dictated the price.” Dumbre became an RML customer barely a month ago and is thankful to his Sarpanch, Hore Jijbhau Manohar, for introducing him to RML. “The daily price updates have helped me make a profit of Rs 500,” he says with a smile.

Apart from market alerts, Dumbre also gets weather and temperature alerts, fertiliser prices and technology tips on his phone. Bantu Desai, a grape farmer in Nashik grasps for words as he recalls how an RML weather alert once helped him save Rs 2 lakh. “Humidity is disastrous for grapes. An RML message warned me that humidity would be high in Nashik. I quickly bought a humidity-cover spray and saved my crops.” Another farmer, Vilas Todkar, was not so lucky. He had not subscribed to any such alerts and says that he lost crops worth about Rs 4 lakh.

RML is trying to reach out to as many farmers as it can, says Amit Mehra. It is now all set to roll out services in other states, including Rajasthan, Gujarat, Himachal Pradesh and Madhya Pradesh. “I believe this service could lead to (cumulative) savings of $5-6 billion,” he says confidently. Mehra describes RML as a social enterprise initiative from the house of Thomson Reuters. “We wanted to take a lead in offering market solutions that have an impact on the society, and yet, are profitable.”

A three-month subscription of RML services costs a farmer around Rs 200-300, while a one-year subscription is in the region of Rs 600-Rs 700. By comparison, a farmer here spends about Rs 10,000 a year on fertilisers. For Reuters, on a subscriber base of 100,000, this means revenues of about Rs 6 crore. “We are charging them for the value we offer. Our services help them reduce risks,” says Mehra.

Seeding the Idea

Mehra, who was earlier in charge of Reuters’ new business development and innovation in London, credits the RML idea to his Swedish team member, Mans Olofors (who currently heads the Reuters Search and News team in Geneva). “I still remember the day Mans walked into my office and said, ‘I need somebody to carry this out,’ as he handed a one-page idea letter to me.” The Thomson Reuters board approved the idea and Mehra was asked to lead the project.

RML identified two markets to launch its service: India and Africa. In fact, the company first decided to launch its services in Africa, and even went there to study the market. Soon, however, it realised that it was Indian farmers who faced an information crisis. “The only source of information for them was Krishi Darshan on Doordarshan. But that gave them only a macro view of things,” says Mehra.

Most farmers relied on intermediaries for local market rates. The latter invariably took them for a ride. Lack of proper information on crop-related technology was also a huge bane.

“Poor farmers never get to know of any government policy decisions,” says Manohar, the Sarpanch of Dawadi village. He pulls out his mobile and retrieves a text message on agricultural subsidies announced by the Finance Ministry. He received the message the day the news was announced. “Usually, it takes months to reach us.”

Manohar, who cultivates roses for both the export market and domestic ones such as Mumbai, Pune and Delhi, receives messages on prices in all these markets at 4 pm every day. “This helps me to make an estimate of what the likely rates would be the next day and how many bunches I should send to the market. I save almost Rs 1,000 every day. Earlier, I had to call up each and every market and find out the rates,” says Manohar. “I was not even sure whether I was getting the right price,” he adds. A short, pot-bellied person, Manohar is visibly the friend, guide and philosopher of hundreds of farmers like Dumbre. As he recounts his RML experience at his village office, about half a dozen farmers huddle around him respectfully.

Earlier, I was at the mercy of middlemen who dictated the price. The daily price updates from Reuters have helped me make a profit of Rs 500 today.— Suresh Dumbre, Farmer

If there was a huge need for information among farmers, there were means to take it to them as well. The mobile phone penetration in villages was more than 30% even in 2006. Around 4-5 million new mobile subscribers are added every month in rural India. “This was an added incentive to launch the service,” says Mehra.

The company launched its service in India in April 2007, and five months later, made it a pay service. This is how it works: RML has a team of reporters who track 600 mandis in the country. It also has partnerships with agricultural universities for content sharing. The information thus gathered is sent out to the farmers through tie-ups with mobile service providers. Those who want the service fill an application form, specifying the information they need, the markets they operate in and the crops they grow. The user profile system developed by RML captures the individual farmer’s details, mobile number, and preferences. This is connected with the mobile delivery platform, which sends the messages based on the user profiles. “We have a very systematic customer feedback system, which we use periodically to confirm that the messages are going as per individual preferences,” says Mehra.

The subscription can be renewed by buying pre-paid cards available at village post-offices, Sarpanch offices and kirana stores. RML offers information on over 150 crop types and covers over 500 markets.

But can Indian farmers actually afford a service such as RML? Krishna Durbha, Head, Value-Added Services (VAS), Reliance Communications, says that the rural consumer purchases as much VAS as the metro consumer. “A mobile screen is like an entertainment screen for villagers. The demand for such services is huge.” Bollywood music and caller tunes account for over 60% of VAS consumption in the smaller markets. But will the same consumer spend Rs 600-Rs 800 a year for farm updates? “If the information is credible, they will definitely pay for it, and RML has proved its credibility,” says Durbha of Reliance Communications. In fact, Reliance Communications has also launched a service called Mandi Bhav, which provides commodity prices to its customers through SMS.

Give Me More

While most farmers are happy with RML’s services, almost all of them have a huge wish-list for the company. Vinay Shinde, Production Manager, Suntek Agro (which exports roses to Europe, as well as to domestic markets), is happy with RML’s weather and market alerts. But he feels that crop-related information needs to be more advanced.

“My revenues have gone up by 20% thanks to the weather and market alerts, but I don’t find the technology tips all that useful,” he says. “We would also like to know the prices at more markets, which could help our expansion plans,” says Sarpanch Manohar. Currently, most RML subscribers can choose a maximum of three markets for which they get alerts. Nine out of ten farmers want information on more than three markets.

Mehra of RML admits that the company is aware of the drawbacks in its services and is working towards improving content. “We are partnering with agricultural universities to offer more advanced crop-related information.”

The company is also looking at providing other information like updates on power supply. Since electricity supply is erratic in rural India, a load-shedding schedule could help the farmers, says Mehra.

RML launched the project with an investment of around $3 million. “Going forward, we will continue to invest so that we are able to offer a superior product,” says Mehra. Is it looking for other revenue streams? The company had initially tied up with fertiliser companies to carry ads along with the messages, but has since abandoned it. “It struck us that we could put off customers by inundating them with messages,” says Mehra. In any case, a few text messages a day are good enough to keep both Reuters and farmers happy.