AFRICA – Heifer International, an international development organization, has announced an additional US$3.5 million in funding for its tractor financing project in Africa, which aims to accelerate agricultural growth on the continent.
The investment comes two weeks after the development organization invested US$1 million in Kenya based, Hello Tractor’s unique Pay-As-You-Go (PAYG) Tractor financing program for agri-entrepreneurs in Nigeria.
This brings Heifer’s investment in catalytic funding for tractor financing in Africa to US$4.5 million since the beginning of the year.
It is also an addition to the previous year’s funding dished to Hello Tractor during Heifer’s inaugural AYuTe Africa Challenge that saw the “Uber for farming” finance 17 tractors for 17 entrepreneurs in Nigeria, Kenya, and Uganda.
The overall US$4.5 million is in support of Heifer’s Tractors 4 Africa (T4A) programme that targets to fund an extra 75 tractors in the three African countries, providing affordable access to tractor services to 872,250 smallholder farmers, enhancing farm production, employment, food security, and farmer livelihoods.
“Increased mechanization, particularly tractors, is critical as smallholder farmers scale up production and develop successful and sustainable farming companies.
“We are particularly intrigued by Hello Tractor’s Pay-As-You-Go tractor financing approach, which originated through Heifer International’s AYuTe Africa Challenge, an agritech competition for young entrepreneurs,” said President and CEO Heifer International Pierre Ferrari.
In the next ten years, the investment will generate 6,979 new jobs as booking agents, tractor operators, technicians, and tractor owners.
In the long run, the Tractors 4 Africa project plans to deploy 50,000 tractors to service more than 90 million smallholder farmers across Africa, creating more than 500,000 jobs.
Globally there are roughly 200 tractors per 100 square kilometers of agriculture lands, but in sub-Saharan Africa, there are only about 27.
This is illustrative of a mechanization deficit that has a significant impact on farm productivity and local economies in a region where most people depend on smallholder farming for income.
Hello Tractor is one of many new agritech start-ups emerging across the continent that are finding business opportunities in addressing this and other farming challenges.
“Africa has the fewest tractors per farmer in the world, and as a result, yields per hectare are low. We want to change the fact that smallholder farmers do not have access to tractors. We welcome our partners and the donor community to join us on this adventure,” Ferrari explained.