Innovation That Matters

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Microfinance for smallholder farmers

Financial Services

A new platform is allowing smallholder farmers to access banking and financing even in areas without connectivity

Spotted: Throughout Africa, a huge number of people are employed in farming. According to McKinsey, more than 60 per cent of people in Sub-Saharan Africa are engaged in smallholder farming, and about 23 per cent of Sub-Saharan Africa’s GDP comes from agriculture. At the same time, however, agriculture attracts very little funding. Lenders tend to shy away from financing smallholder farms, which prevents them from becoming more productive.

Ghanaian fintech startup Fluid is working to change this with a platform that helps smallholder farmers access loans. The organisation began with SafeSusu, a mobile application that can create bank accounts and track savings deposits in rural areas without connectivity.

Following its success – SafeSusu has so far attracted more than 26,000 bank accounts — Fluid launched Sumerian, which focuses on helping smallholder farmers access microfinance loans. The platform provides technology to banks that loan officers can use in the field to help them determine the risk associated with a loan. Sumerian also aids in tracking field operations, allows digital payments, ensures that new accounts contain accurate customer data, and reduces fraud risk.

Fluid founder Moustapha Seck explained the need for this type of microfinancing tool in an interview with Disrupt Africa: “While banks use many different technology providers to be closer to the field, only Fluid and AgroCenta, to our knowledge, focus on the huge market of smallholder financing. Fluid stands alone in its focus on mitigating risks for the bank and the farmer.”

High costs and lack of access to loans is holding down investment in agriculture in many regions, a fact which has led to a number of innovations aimed at improving the situation. Springwise has spotted an app that helps farmers digitise farming practices, and a platform that makes it easier for smallholders to connect with buyers to promote regenerative agriculture.

Written By: Lisa Magloff

Email: fluid.fintech@gmail.com

Website: fluidfinance.co

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