On November 2, the six finalists of the NpM Innovator’s Challenge will gather at the Accenture Innovation Summit to pitch their solutions to a grand jury. Each finalist offers unique ways of using geodata to support access to finance for smallholder farmers.

Three winners will receive a prize of €125,000 each - granted by Rabobank Foundation, FMO and the Bill & Melinda Gates Foundation - to implement their solution with a financial service provider. This challenge and its three resulting projects represent a step in solving one of the world’s most pressing challenges: achieving global food security.

The six finalists are Impact Terra, Agri-wallet, VanderSat, Alethiom, Financial Access/Satelligence and Apollo Agriculture. We asked each of them to tell us more about what they do and outline the solution they'll be pitching as part of the NpM Innovator's Challenge. This is what they had to say.

Impact Terra: A solution that hypothetically could be implemented tomorrow

"Microfinance institutions (MFIs) need to move into smallholder financing. After all, smallholder farmers produce the majority of the world’s food and represent 40 percent of the GDP, and urban markets are becoming saturated. However, MFIs face significant challenges as this market segment is very new to them and smallholders are perceived to be risky and difficult to access," explains Erwin Sikma, founder of social enterprise Impact Terra. "Now that advanced technologies are available, we can develop innovative products, service and business models to address this problem and meet customers’ needs."

That’s exactly what Sikma and his team did in Myanmar when they launched the mobile platform Golden Paddy (the name references the fact that in this Buddhist country, gold is synonymous with luck and prosperity; rice – hence paddy – is also local farmers’ number one crop). About 70 percent of Myanmar's population is involved in smallholder farming. This forward-thinking platform provides farmers with weather forecasts and information about local crop prices, while also serving as a marketplace where farmers can connect with buyers and lenders. Last March, Impact Terra raised nearly three million dollars for their Smart Agriculture Myanmar (SAM) project. "In the SAM project, we develop services and technologies for millions of farmers in Myanmar and other Southeast Asian countries, providing them with real-time advice (to reduce crop losses) and including them in the formal financial system."

"We think it’s important to ask the questions 'What do our clients (the MFIs) truly need?', and 'How can we best utilize technology to meet those needs?' After a year’s worth of designing in collaboration with smallholders and MFIs, we now have solutions that can really have an impact and could hypothetically be implemented tomorrow. Instead of taking the view of the 'piteous' farmer, we believe it makes more sense to look at the situation from the perspective of the ones providing the loans. We ask ourselves: 'What do they need in order to run their business?' This way, we help farmers get better, cheaper loans. Our goal? That in 10 years from now, all five hundred million smallholder farmers in emerging markets will be connected to our platform, which will have, by then, more advanced solutions and even better services." 

Image: NpM Innovator’s Challenge finalist Impact Terra - by Accenture

(Source: Impact Terra)

Agri-wallet: Achieve a permanent change in mindset

For Nairobi-based startup Agri-wallet, the solution to farmers’ lack of access to finance lies in blockchain technology. The innovative platform, launched earlier this year, links farmers in developing countries with a secure, instant and near-free global virtual currency account on their mobile phones. By using a virtual currency based on blockchain technology, farmers can bypass expensive traditional banking systems and gain access to a worldwide network of lenders with ease.

"But that’s only half the story," says Sijmen de Hoogh, who’s responsible for connecting 10,000 Kenyan farmers with the Agri-wallet concept. "What Agri-wallet ultimately aims to achieve is a permanent mindset change among Kenyan smallholder farmers. Currently, local farmers live from hand to mouth: whatever income they receive goes straight towards survival. Saving simply isn’t an option, as the money they earn is needed for basic needs and wants; nothing is kept aside for farm inputs, like seeds and fertilizer. Our key objective is to change the system by encouraging farmers to save money."

"We’re already seeing the benefits of our platform in this regard. Our records show that farmers with an Agri-wallet are able to produce up to 400 percent more food when funds are not spent on private consumption and non-income-generating activities. Today, over 5,000 farmers are using the virtual wallet, and an impressive 35 percent of them have savings in their accounts that are earmarked for business inputs. That’s pretty revolutionary," says De Hoogh. "If we manage to continue to grow as quickly as we have been – at a rate of 1,000 farmers per month! – and get the majority of these producers to start saving and spending their money wisely, we’re onto something really special: a fundamental change in farmers’ financial behavior. This shift could ultimately help them break the cycle of poverty and dramatically improve food production at the same time."

VanderSat: Seeing through clouds and darkness

Lifting farmers out of poverty is also top of mind for VanderSat, a Dutch scale-up that uses satellite data to support the agricultural sector. Climate change tends to increase the occurrence of floods and droughts, which increases the risk that farmers will get trapped in a vicious cycle of poverty as crops repeatedly fail. VanderSat derives information about soil moisture, vegetation water content and land surface temperature from advanced satellite systems, globally, daily, at field scale, without ever being limited by cloud cover or darkness. The VanderSat data helps financial service providers to predict floods, droughts and related food security issues, which enables them to quantify farmer risks so they can provide tailored financial solutions to individual smallholders.

Céline Nobel of VanderSat explains: "As we look at a specific part of the energy spectrum – namely passive microwaves – we aren’t hindered by cloud cover and always have data available. This is vital for our success and is precisely what distinguishes us from many other satellite data companies. What’s more, while this type of satellite data has long been used for science, we are one of the first companies that is using it for commercial purposes. Besides, we have an archive of satellite-observed agricultural data spanning the past 40 years. Lastly, we have the infrastructure to build an efficient, scalable solution."

Image: NpM Innovator’s Challenge finalist VanderSat - by Accenture

(Source: VanderSat/Unsplash)

And what is the solution that VanderSat proposes? TARA: a risk assessment platform for financial service providers that translates satellite data into quantified risk information pertaining to local crop conditions, farmer practices and the capacity of smallholders to cope with climate change.

"On the TARA interface, risk information can be combined with data relevant to financial service providers (e.g. farmer loan history, input demand, and payout history), enabling the development of geodata-based financial solutions like loan-advisory-insurance packages and (mobile) credit scoring. Ultimately, this leads to a fairer system in which smallholders benefit from more financial inclusion."

Alethiom: Scaling up is the real challenge

Alethiom was launched when a few experts in the fields of finance and geospatial analysis put their heads together to see how they could use their wide-ranging expertise to solve problems that plague smallholder farmers in East Africa, and the planet at large. They concluded that in this part of the world, the fact that quality ground-truth data isn’t available at scale is one of the biggest obstacles facing smallholder farmers and financial institutions. Their solution? To harness the power of geospatial data in order to gather accurate yield data.

One of the Alethiom experts we speak of is Cale Ettenberg, a Canadian geospatial specialist. "The plan that got us to the finals of the NpM Innovator’s Challenge is to use data from drones (UAVs) to train satellite imagery to calculate yield at scale. It’s the 'at scale' that is key here," explains Ettenberg. "Of course, various approaches that use data to help smallholder farmers already exist, but scaling these methods up is always a challenge. UAVs can provide amazing data and many projects have successfully used UAV products on small projects, problems with scaling means that it often becomes more cost-effective to just do direct farmer interventions."

Image: NpM Innovator's Challenge Alethiom - In-article image - by Accenture

The data they collect will help with the disconnect between yields self-reported by farmers and actual production levels. Financial institutions can, therefore, get a better idea of farmers’ performance and self-sufficiency and develop a clearer sense of which loans could potentially be riskier. By combining UAV data with satellite data, Alethiom hopes to provide a highly scalable solution – whether they are looking at 100, 1,000 or 100,000 farmers, the method should still apply.

"We are trying something completely new here; I haven't seen anyone who has been working to find the connection between UAV and satellite data so that this information can be used to create a model that scales. That, in itself, sets us apart from other data-driven companies," Ettenberg points out. "However, regardless of whether we are one of the winners of this challenge, I am really looking forward to the experience and excited about the opportunity to share our ideas with innovators from around the world."

Financial Access and Satelligence: Funding for the most underserved farmers

Also pitching at the summit is a team from Amsterdam-based Financial Access and Satelligence, which specializes in providing highly detailed, actionable, satellite-based insights for large areas. Together, they’ve developed an integrated solution for, as they put it, ‘one of the most complicated issues compounding the global food challenge’: securing funding for farmers who are perceived to be the riskiest – those who grow perennial crops, such as oil palm, coffee and cocoa.

Eelko Bronkhorst, Managing Director at Financial Access, explains: "As long as these farmers’ plants provide enough produce, everything is fine, but difficulties arise when replanting is required after a number of years as aging trees result in (much) lower production. Aside from being a complicated and time-consuming process, replanting also leaves farmers with a significantly lower yield, at least until the new crop starts to deliver again, which can easily take up to four years. Try to find a bank that will fund you given these circumstances – your chances are slim, to say the least."

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The satellite data-driven methodology designed by Financial Access and Satelligence significantly reduces the risks financial institutions perceive when it comes to perennial farming and flips the picture so that funding this category of agriculture becomes a commercially interesting and viable endeavor. Niels Wielaard, Managing Director at Satelligence, adds: "We provide easy access to trustworthy environmental and credit risk analyses based on targeted field data, combined with weekly satellite-derived plantation performance and risk information allowing us to scale to thousands of farmers.

"It’s a real game-changer," Bronkhorst says. "Because these farmers are the ones struggling the most, the added value of our methodology is huge. If we do it right and get more investors to come on board, we can revitalize tens of thousands of acres of land planted with coffee, oil palm and cocoa. Another benefit is that this will prevent farmers from destroying vulnerable ecosystems in a desperate attempt to generate alternative income from farming elsewhere. Essentially, we deliver a double dividend: not only do we help farmers to meet their financing needs, but we battle deforestation, too."

Apollo Agriculture: Customized packages of seed and fertilizer

The sixth finalist in the NpM Innovator’s Challenge is Kenyan startup Apollo Agriculture. Apollo leverages agronomic machine learning, remote sensing technology, and mobile phones to deliver the tools farmers need to increase their yields and the credit to afford them, without reliance on expensive, manual processes. The company’s first product is a customized package of seed and fertilizer, farming advice and credit delivered to maize farmers.

Image: NpM Innovator's Challenge Alethiom - In-article image - by Accenture

(Source: Apollo Agriculture)

 

We wish all participants in the NpM Innovator’s Challenge the best of luck in the lead-up to the Accenture Innovation Summit and look forward to learning more about their novel work on November 2!