Safaricom Spark Venture Fund has today announced its investment in FarmDrive, a data analytics start-up that connects small-scale farmers to financial services.
The venture fund did not disclose the amount invested. However, Bob Collymore CEO, Safaricom, says the investment in FarmDrive is part of the $1 million that the company put into the Safaricom Spark Fund. "Due to confidentiality clauses with the start-ups we invest in, we do not reveal how much we put into each company."
The Kenyan start-up uses mobile phones, alternative data, and machine learning to close the critical data gap that prevents financial institutions from lending to creditworthy smallholder farmers. The company was co-founded in 2014 by University of Nairobi computer science graduates Rita Kimani and Peris Bosire.
According to FarmDrive Web site, as young girls, both Kimani and Bosire witnessed the frustration their families and communities faced in agriculture. Despite toiling away for months on end, their harvests were meagre due to lack of capital to purchase the critical farming inputs that could increase their yields and revenues.
"Using simple mobile phone technology, alternative credit scoring, and machine learning, FarmDrive closes the critical information gap that keeps smallholder farmers from the financial services that would allow them to grow and diversify their businesses," says Kimani.
Kimani says the investment will go towards supporting the next phase of growth by building FarmDrive's innovative credit scoring model and enhancing its human resource base in research, analysis and insight generation.
"We are excited about this investment because it enables us to scale this innovation, score more farmers, unlock more capital, and grow the agricultural loan portfolios of our financial institution partners. This is all good for the inclusive development of our country."
FarmDrive says it seeks to address the lack of visibility and data that lenders cite in denying smallholder farmers access to financial services. FarmDrive's main goal is to bring millions of smallholder farmers into the formal financial sector through the simple mobile phones already in their pockets, it adds.
Leveraging android and SMS, the mobile phone application allows farmers to track their revenues and expenses, and as well as apply for loans, says FarmDrive. The data is then fed into a credit-scoring algorithm, alongside key satellite, agronomic, economic data, to help improve yields, it adds.
"In an era when market uncertainty is creating new challenges for the agricultural sector, mobile-based technology solutions like FarmDrive can empower farmers with the critical access to finance and to help expand their access to other essential services," says Collymore.
Share