Bayer’s tech tool enables farmers avail cheaper credit

Transparency in transactions brought in through IT interventions is helping farmers, particularly women farmers with small holdings to access cheaper credit.

Bayer Crop Science, which has recently tied up with Axis Bank, has been able to provide to members of its Better Life Farming (BLF) initiative, many of them women farmers, loans at 6 -7 per cent interest as against 26-30 per cent charged by non-banking financial companies (NBFCs), Rohit Maini, Lead of Grower Engagement at Bayer for India, Bangladesh and Sri Lanka told BusinessLine.

“What we are trying to do through our Lite ERP system, which we are putting around our agri entrepreneurs, is to increase visibility of the transactions which happen with the farmers such as what the agri entrepreneur is giving them. We are also trying to link the ERP system to the produce coming from the farmers or being sold by them. This helps generate datapoints that banks need for offering them credit,” Maini said.

Women farmers

Maini admitted that they have been able to offer credit only to a few farmers at present but added the tie-up with Axis Bank was just two months old and much more is expected in near future. This is significant because a large number of small farmers are women whose lack of land titles making it difficult for them to access formal credit. It is said that nearly 70 per cent of farmers in India are women.

BLF — which Bayer created together with its partners such as Yara Fertilisers, International Finance Corporation, Netafim, DeHaat, AgriBazaar and Big Basket about two and a half years ago — seeks to create clusters of rural agripreneurs who would run their BLF centres. Each such centre caters to 500 small and marginal farmers in five or six villages nearby. Apart from ensuring that the farmers have access to quality agri inputs and proven farming technologies, these BLF centres help them with aggregation and sale of farm produce.

According to Maini, currently there are 210 such centres in Uttar Pradesh, Jharkhand, Madhya Pradesh and Bihar, catering to 50,000 farmers. BLF initiative would be expanded to Bihar, Maharashtra, Odisha and West Bengal and would have 440 centres covering up to 3 lakh farmers by the end of the year, the Bayer executive said. Currently, the focus at these BLF centres are three crops – chilli, tomato and paddy.

“The idea is to cover 2.5 million farmers in India by 2025,” Maini said.

Tapping tech

Simon Wiebusch, COO for Bayer India, said the BLF initiative is meant to create an ecosystem. In most of rural areas in the country where basic infrastructure was missing, getting access to original products is a huge problem. “When we worked with chilli farmers in Varanasi, we realised that when you do the intervention you uplift literally the economy there. The idea is to look at expanding it more and more,” Wiebusch said.

While the scalability of brick and mortar centres is limited, the increasing access to mobile phones and other digital technologies makes it possible to have click and mortar, or virtual, stores. “Right now, we still count the number of (BLF) stores, over time you could be finding literally virtual stores coming up, which will then have a hub and spoke approach. Beauty is that this can help introduce new technologies for planting or harvesting. In future even potentially drone applications,” the Bayer COO said.

He said if the person manning the BLF centres is enterprising enough, a number of other things can come up around it offering services such as custom hiring of farm machineries or a cold storage.