Transforming communities with credit scoring
Small holder farmers are one of Ghana’s most financially vulnerable groups, most of whom are women with families to support.
"Mergdata’s finance tools de-risked the process for ABSA Bank by giving them the information they needed to be able to have confidence in their farmers."
Lack of funding stops many from being able to purchase the right seeds, fertilisers and farm machinery to produce a good harvest and make a profit from their land. But without being able to prove that they run a stable business, getting the financial support they need is almost impossible.
That’s why Mergdata and our sibling organisation Farmerline partnered up with ABSA bank, who have recently activated a $1million fund specifically to deploy to Ghanaian agribusiness.
There’s often a very fine line between a farmer who can pay back a loan and a farmer who can’t. Without a substantial and verifiable credit history, it’s hard to tell the difference. Mergdata’s finance tools de-risked the process for ABSA Bank by giving them the information they needed to be able to have confidence in their farmers.
As a social enterprise with operations across Ghana, Farmerline was already working with a large group of local small-holder farmers. Over the past few years, we’ve been delivering financial literacy training, teaching farmers about bookkeeping, mobile money and digitising their financial processes.
Then, with Mergdata’s GROW app, smallholder farmers kept digital records of all their payments. After a few years, these farmers built up a verifiable credit history and could apply for more substantial loans from ABSA bank.
Mergdata also digitised the loan process from end to end. Farmers were able to complete ABSA’s specific KYC checks on their phones and make mobile repayments at the end of the growing season.
Over the next 12 months, ABSA Bank plans to utilize the full $1million fund. The aim: to finance 6000 farmers. After the first group of agribusinesses repay their loans, another fund will be opened for the next growing season and a new set of farmers. And it doesn’t stop there. Mergdata will continue to partner with ABSA bank to identify new opportunities for growth and communities in need of support.
$1million FUND
WITH A TARGET OF FINANCING
30 AGRIBUSINESS
AND IMPACTING