March 2021 agricultural “platforms” in a digital era

Investment Platforms
In the agricultural sector, investment Platforms 
connect small-scale investors (typically 
individuals) with farmers in search of capital.
The transaction usually involves small, short-term 
loans to farmers who are cash-strapped at the 
beginning of the planting season. These loans are 
typically used for inputs, equipment, land, and/or 
crop diversification, and usually carry zero or low 
interest rates. The revenue model for investment 
Platforms specific to smallholder agriculture 
is the same as for non-agriculture investment 
Platforms, relying mainly on transaction fees. 
Smallholder investment models tend to be tech 
start-ups whose core offering is underpinned by a 
crowdfunding Platform. Most models are similar 
in their use of technology and their singular focus 
on facilitating investment. However, they differ in 
the type and degree of curation and facilitation. 
In general, on the investor side, all of these 
Platforms are open—meaning investors are not 
actively screened or selected. On the investee side, 
however, most Platforms actively curate and/
or manage their featured farmers. For example, 
Indonesian peer-to-peer lending Platform Crowde 
originally intended to connect consumer investors 
to farmers, but has more recently expanded into a 
broader range of facilitated services. Crowde now 
works directly with input providers to pay loans 
to farmers via in-kind inputs rather than cash. 
Offtake agreements are facilitated and tied to loan 
repayment, and the Platform offers training to 
farmers—all of which is aimed at increasing the 
likelihood that loans will be invested productively 
and that risk to the lender is minimized. Many 
investment Platforms employ field staff to recruit 
and actively support farmers in deploying their 
loans productively (e.g., Thrive Agric in Nigeria) 
or require farmers to apply in order to borrow 
money through the Platform (e.g., Agrapp and 
Bayseddo). We identified one agriculture-focused 
investment Platform—PlusPlus—that operates 
similar to sector-agnostic Platforms such as Kiva, 
but which focuses specifically on agricultural SMEs.