Ghana's Complete Farmer raises $2.4m to finance farmers

Ghanaian agri-tech company Complete Farmer has secured $2.4 million in convertible financing from the International Finance Corporation (IFC) and BIFT. It is also getting $660,000 in grants and advisory support. The funding will be used to expand the company's financing of agricultural inputs and its work with farmers. Complete Farmer connects farmers with buyers, input suppliers, financial institutions and other businesses involved in agriculture. 

Its financing programme helps farmers get inputs before they harvest and earn money from their crops. The timing of that financing matters. A farmer needs money for seeds, fertiliser and other inputs at the beginning of the season, while income from the farm may only come months later.

Complete Farmer wants to reach 240,000 farmers

The company currently works with more than 72,000 farmers across eight regions in Ghana, according to IFC. The new funding will support an expansion of its input financing programme. IFC expects the partnership to help Complete Farmer reach 240,000 farmers by 2030. Complete Farmer has also expanded into Togo and has eight fulfilment centres. Its platform brings together several parts of the agricultural supply chain, including farmers, buyers and suppliers. That gives the company a role beyond simply providing software to farmers.

What this means for SMEs

The impact could extend beyond the farmers receiving financing. Small businesses that supply seeds, fertiliser, equipment and other farm inputs could see more demand as Complete Farmer expands its farmer network. There is also potential work for SMEs further down the supply chain. Transporters, storage businesses, aggregators, food processors and produce buyers all depend on farmers producing enough stock and getting it to market.

For these businesses, more financed farmers could mean more agricultural activity to service. But that does not automatically mean more business for every SME. The effect will depend on which farmers receive financing, what they produce and where they operate. For SMEs buying or processing agricultural products, a larger pool of financed farmers could also make it easier to plan around supply.

That makes the deal relevant beyond the fintech and agri-tech sectors. More financing at the start of the farming cycle can affect the businesses that supply, move, process and sell what farmers produce.

IFC is also financing Ghana's cocoa trade

The Complete Farmer deal comes as IFC increases its involvement in agricultural finance in Ghana. IFC and Absa Bank Ghana are working on a separate programme for Licensed Buying Companies that purchase cocoa from farmers. IFC and the Global Agriculture and Food Security Program will provide up to $50 million in risk-sharing support for the programme. Absa could then provide up to $200 million in financing to the cocoa buying companies.

The programme is expected to reach more than 139,000 smallholder cocoa farmers. For Complete Farmer, the immediate task is fairly straightforward: use the new financing to put more inputs in farmers' hands and increase the number of farmers using its platform. The company now has until 2030 to work towards the 240,000-farmer target set out under the IFC partnership.