TerraMagna, an agriculture FinTech company, has closed its seed round on an undisclosed amount.
The investment was led by ONEVC, with contributions also coming from MAYA Capital, Accion Venture Lab and a series of angel investors.
TerraMagna aims to improve the access to credit for independent Brazilian farmers that finance 80% of their working capital each planting season to buy inputs such as seeds, fertiliser, herbicides and pesticides. Traditionally, farmers have been ignored by banks, TerraMagna claims, and this has forced farmers to rely on expensive short-term financing from retailers or trading companies.
The FinTech company changes this by leveraging satellite imaging technology and various data sources to underwrite input loans and offer small and medium farmers in Brazil with affordable credit.
By partnering with input retailers and helping them accurately assess farmer creditworthiness and monitor crop collateral, more farmers can access funding they need.
TerraMagna executive director and co-founder Bernardo Fabiani said, “The high dependency of Brazilian agriculture on financing, the end of credit subsidies, the lack of private players able to directly provide credit to the agribusiness value chain and the low interest rates created a timely and durable USD 30B opportunity gap to connect the field to the capital markets.
“We are grateful to this group of investors for their support, and look forward to leveraging their expertise in fintech startups to expand TerraMagna’s product offerings and reach even more farmers who are in need of financial services.”
Accion Venture Lab managing director Vikas Raj said, “TerraMagna is filling a massive gap in financing for Brazil’s small and medium farmers and helping them grow their businesses and support their communities. By leveraging new technologies and integrating with retailers, Terra is not only providing farmers with frictionless and affordable credit, but is also allowing them to access a wider variety of higher quality products.”
Copyright © 2020 FinTech Global