Agriculture is the mainstay of Nepal’s economy providing livelihoods for 68 percent of its population and accounting for 34% of the country’s GDP.

Nevertheless, it struggles with low productivity, traditional and labor-intensive farming practices, and little to no access to improved seeds, technologies, finance, and market opportunities. However, with the aid of technology and digital innovations, farmers are able to address various challenges in the agriculture sector across the world.

Nepal AgriTECH challenge launched by UNCDF Nepal last year aimed to bridge the gap between the agriculture and technology sectors to develop scalable solutions that could create value for smallholder famers, through increased production, access to market and improved income. The challenge was a part of UNCDF’s Inclusive Innovation Initiatives to support products and services that meet the needs of underserved communities.

The challenge received a total of 123 registrations and 69 submissions from across Nepal. 10 teams were selected as finalists for a 3-stage process composed of design, product development and final selection. After the incubation and design period consisting of two intensive bootcamps, the finalists demonstrated their projects on 30 September 2019 to an audience comprising of development partners, potential investors, and an independent jury. Based on the combination of their performance and progress during the challenge and presentation of final demo day, the top two finalists were selected.

The top two AgriTECHs

Zen IT Hub (now named Aria Technologies) presented ‘Mizani', an app-based loan appraisal platform that addresses the issue of data shortage in processing credit for agriculture. The platform uses different parameters and criteria specific to agriculture to generate a credit score for smallholder farmers to access loans.

Six months down the road, Mizani has now expanded its team and is discussing with two financial institutions for potential business contracts. “When we entered the AgriTech challenge our idea was very basic but the bootcamp helped us to make our product more customer-centric,” says Bibhor Kayasta, Co-founder of Aria Technologies. “We want to make sure that the farmers applying for loans are fairly assessed without any biases. Our application will aggregate digital profiles of the farmers, apply analytics for financial and technical assessment, and tell the bank how much creditworthy the applicant is,” he explained.

By helping credit appraisal, Mizani will, in turn, simplify and accelerate the agriculture loan appraisal and optimize risk-profiling for banks. Digital platforms such as Mizani will help farmers forge an economic identity even for those previously unbanked offering smallholder farmers a pathway to financial inclusion.

E-Satya presented ‘Agri Clear’, a blockchain-based traceability solution to share information on food sources and its production process. This information is then logged in a blockchain-based platform to make logs transparent and immutable. In an obscure supply chain with a simple scan of the QR code, a consumer gets to know the provenance of the product and transformation throughout the value chain. Traceability and authenticity using blockchain technology bring in transparency in the food supply chain process and in the long run, can also benefit smallholder farmers by opening up opportunities to access credit and markets.

E-Satya’s ‘Agri Clear’ project has also come a long way. The inspiration for their product had come about from a farmer in a village in Sindhuli who was struggling to sell his organic vegetables and was unable to receive a fair price for them. “We want to help farmers practicing organic farming by validating that their product is safe. People want to know if the product they purchase is safe or not and they are willing to pay the right price compared to a lesser quality product,” highlighted Shristi Piya, Project Lead of Agri Clear. Traceability helps connect the two ends – producer to procurer – building trusts at two levels, helping build consumer confidence and helping farmers get a fair price for their products.

Driving the growth of AgriTECH

As part of technical assistance, UNCDF is providing direct support to the top two finalists to refine their business plans, develop and test working product prototypes, and deliver a proof of concept to make them ready for investment. The top two finalists will be awarded a USD 30,000 grant once the UNCDF grant review process is completed. The grant will provide access to much-needed capital for these AgriTECHs in their infancy – ensuring they finance the critical phases of their product and business development. The technical support by UNCDF will continue for a year to establish market linkages and networks, test the go-to-market strategies, scale-up and develop their idea into a real, sustainable business.

“The Nepal Innovation Challenge is a part of our efforts to promote digital innovations that enhance financial inclusion, and adoption of digital financial services in Nepal,” said Abhay Pareek, Digital Finance Expert. “With the mission of ‘leaving no one behind in digital era’, UNCDF Nepal supports digital innovations that address life challenges particularly of the vulnerable populations.”

Innovation challenges like the AgriTECH are ideal for fostering the culture of entrepreneurship and contributing to the development of the Nepali innovation eco-system. Through this first round, UNCDF was able to create an interest in the emerging Nepali start-up community to serve underserved segments of the economy, especially on smallholder farmers and micro-enterprises to bring change to the agricultural industry, which is of such vital importance to Nepal’s economy.