In Mexico there is a lag of 50% of the agri-food production, that is, it produces barely half of the food that is required and part of that barrier is due to low productivity in the country’s agricultural sector. To combat this problem, the German Sparkassenstiftungin collaboration with the innovation laboratory Brixton Ventures Labannounced the second phase of the agro.connect program.
The intent of this program is to connect agrotechnological (fintech and agrotech startups) with financial entities, especially savings and loan cooperatives (socaps), focused on the country’s agricultural sector, to make the latter’s processes more efficient and thus be able to have more impact on the country’s small producers.
“Our financial institutions are looking for a functional ecosystem and you (startups) create these ecosystems, because they are tools with solutions that are going to solve current problems. In recent years we wanted to detect where the gaps are and with digitization, innovation and digital transformation we know how to close these gaps that we have detected”, explained Gerd Weissbach, General Director for Latin America and the Caribbean at German Sparkassenstiftung.
For Julián Romo, consultant for Cooperation with Startups for Sparkassenthe savings and loan cooperative sector in Mexico focused on the country’s agricultural activity has the challenge of making its processes more efficient through technology, in order to support producers in their activity.
“There are some financial institutions that still have analogous processes, for example, from the credit application. In the previous edition of the program, there were very positive results of a credit application that took between 30 and 45 days to digitize it, the times were reduced between three and four, which for the small producer is wonderful. Many times, that time made him lose the time when he could plant,” Romo commented.
German financial arm
the financial group Sparkassen It is one of the largest in Europe, with 520 institutions that are part of it, of which 400 are German savings banks, and with operations close to 3 billion euros
The German Sparkassenstiftung is the consulting arm of said financial group and currently has a presence in Latin America in order to support the sustainable development of the region through financial inclusion.
In this context, it has initiatives such as agro.connect, which seeks to select the best companies to develop a collaborative project with financial institutions allied to the scheme and thus increase the financial inclusion and productivity of people who are small agricultural producers.
“Mexico is the second largest economy in Latin America and where there is a dependency on agricultural and agri-food production of approximately 50%, that is, it produces 50% of the food it needs and part of this barrier (deficiency in the supply of food ) is due to low productivity and profitability that is closely linked to the technological issue and the lack of innovation in the agri-food sector,” said Romo.
“The objective -he added- is to strengthen the agri-food sector and promote rural development in Mexico through this offer of adequate financial services. With all this, it is where agro.conect arises”.
Those interested in participating must send their proposal until next May 31 through the page: https://www.agroconnect.mx/.
In the first phase, the participating companies were Conecta, Imix, IncluirTec, Siembro and Verqor, which supported socaps such as Caja Depac Poblana, Progresemos, Caja Popular Mexicana, Caja Solidaria Valle Guadalupe and Acreimex. Through this scheme, 20 million pesos in credits were provided.
According to the call, after the closing of the same, the companies will be evaluated and the finalists will be announced at the beginning of June to start with the scheme on June 27.
Among the benefits of accessing this scheme are the following:
- Access to financial support without obligation to pay, or equity-free of up to 10,000 euros.
- Linking with allies in the agricultural sector.
- Individual counseling and accompaniment during the duration of the program.
- Mentorships given by experts in the rural and financial development of the sector.
- Realization of a collaborative project with some of the allied financial institutions.
“This is the first program in Latin America that fosters collaboration between startups and savings banks or rural cooperatives. As in the first edition, we will focus on selecting the startups with the greatest potential and that have the technology to have a significant impact on the Mexican agricultural sector”, said Karla Chávez, co-founder and director of Innovation at Brixton Ventures Lab.
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