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Source: Village Capital
Key Highlights
Village Capital has invested USD 350,000 in Nigerian agtech startup Crop2Cash.
The funding will accelerate Crop2Cash’s efforts to build a more sustainable future for African agriculture, benefiting both farmers and stakeholders.
Village Capital has invested USD 350,000 in Crop2Cash, a Nigerian agtech startup catering to smallholder farmers by providing access to banking, credit, agricultural inputs, warehousing, and insurance. This investment is part of Village Capital’s Reducing Inequalities Investment Facility, supported by FMO’s Micro and Small Enterprise Fund (MASSIF), which aims to promote financial inclusion by backing innovative financial solutions and inclusive businesses.
“We are thrilled to receive this investment from Village Capital, which validates our approach to addressing the critical challenges smallholder farmers face in Nigeria. By leveraging our unique technology and strategic partnerships, we are revolutionising financial inclusion and providing smallholder farmers with the comprehensive support they need to grow their businesses and improve their livelihoods. This funding will accelerate our efforts to build a more sustainable and equitable future for African agriculture.” Michael Ogundare, Founder, Crop2Cash.
“For the Reducing Inequalities Initiative, we are looking for companies that create opportunity and improve the quality of life for rural livelihoods,” shares Kavon Badie, Investment Officer at Village Capital. “Crop2Cash is doing this for thousands of smallholder farmers in Nigeria by enabling financial inclusion and access to essential services required for farmers to grow their businesses and thrive. We are excited to partner with Michael and the Crop2Cash team as they scale this impact to more smallholder farmers.”
The Agtech company which has raised USD 2.8 million in credit for smallholders and supported 400,000 farmers is addressing financial exclusion among smallholder farmers in Nigeria. Despite banks being the primary source of agricultural finance, with funds for agriculture growing by 35% annually, less than 5% of their loan portfolios go to this sector. Smallholder farmers are often excluded from traditional bank financing due to various factors, such as stringent collateral requirements, a limited understanding of market risks, and the lack of a robust rural branch network to access and serve them.
Smallholder farmers in Nigeria have largely been excluded from the financial system, making them difficult for banks to reach. Crop2Cash is transforming financial inclusion for this underserved group by allowing farmers to open bank accounts in under two minutes using basic feature phones and USSD technology. By leveraging innovative technology and forming strategic partnerships with financial service providers, Crop2Cash has made various services accessible to farmers.
With the Crop2Cash platform, smallholder farmers can effortlessly manage transactions and payments for their inputs, access credit, and obtain insurance, all through their phones. Beyond financial services, Crop2Cash offers a marketplace where farmers can easily purchase high-quality agricultural inputs. The startup also digitally connects agro-processors with farmers and other suppliers, enhancing market access and integrating farmers into the digital economy. These services pave the way for a more efficient and sustainable agricultural sector, benefiting both farmers and stakeholders.