NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Wednesday, January 31, 2018

MIX and One Acre Fund announced the launch of the Smallholder Finance Product Explorer, a new, centralized directory where the agricultural finance industry can, for the first time, access detailed information on existing smallholder finance products. The goal of this new resource, which is available through the popular MIX Market platform, is to make accessible operationally useful information in order to inspire the development of new financial products for smallholder farmers and improve existing ones.

Smallholder farmers constitute the single largest market segment for financial inclusion, yet the financing available to them lags behind the potential need, estimated in excess of USD 200 billion. The lack of information about smallholder agricultural opportunities not only impedes the flow of funds, but also constrains the development of financial products tailored to the unique needs of smallholder farmers. Therefore, providing the information required by lenders and financial service providers is critical to reducing the financing gap in the segment.

“Financial service providers around the globe are positioned to address financing gaps in their local markets, but they face high resource constraints to develop and deploy financial products for smallholder farmers,” said Mike Warmington, microfinance partnerships director at One Acre Fund. The Smallholder Finance Product Explorer addresses this challenge by increasing the visibility of existing financial products with relevant funders and investors. Similarly, this directory will increase the ability of funding institutions to identify service providers with robust product offerings.

Additionally, the industry as a whole will benefit from the improvement in available information on smallholder financial products. “The unique wealth of data, and the insights that can come from it, will enable financial inclusion practitioners and funders to learn from one another much easier than ever before,” said Blaine Stephens, MIX’s chief operating officer. “This can catalyze the development of impactful smallholder finance products across hundreds of financial service providers.”

The Smallholder Finance Product Explorer creates an easily accessible structure that will bring insights, efficiency and growth to the agricultural finance industry. Through in-depth research with industry actors, MIX and One Acre Fund identified the key information needs of both funders and service providers. The initial launch of the Smallholder Finance Product Explorer will include data on over 35 institutions reporting on ~80 financial products.

To learn more please visit: www.themix.org/mixmarket/smallholderfinance

Photo courtesy of Irene Scott / AusAID.