Agri-Fintech Startup Raises $20 Mn In Debt Funding With DFC Guarantee

SUMMARY

The loan will be issued through a local bank with a guarantee from the DFC

Origo provides financing and solutions for reducing post-harvest losses to farmers and others in industry

The DFC is US Federal Govt. agency that invests in development projects in the developing world

Agritech startup Origo Commodities has raised $20 Mn in debt funding from the United States International Development Finance Corporation (DFC). The loan will be deployed through a local bank with a guarantee from the DFC.

Founded in 2010 by Mayank Dhanuka and Sunoor Kaul, Origo provides solutions for reducing post-harvest losses in the commodity supply chain, including farmers, traders, processors, bulk buyers, warehouse owners and financial institutions.

The startup also helps dairy businesses and small enterprises in rural areas obtain financing for their business. The company employs 8,000 people across 12 states.

The startup plans to use its digital trade and finance platform E-mandi to facilitate better price discovery and seamless commodity trading. The financing will be used to expand Origo’s structured trade finance portfolio.

Earlier, the startup had raised INR 35 Cr debt from Northern Capital and other investors. Before that, it had raised INR 48.5 Cr from Switzerland-based responsAbility, Netherlands-based Oikocredit’s Indian subsidiary Manaveeya and IndusInd bank.

Origo’s trade finances increased from INR 100 Cr in FY 20 to INR 180 Cr in FY 21. According to the startup, it is on track to reach the figure of INR 600 Cr in FY 22 with 130 Cr already achieved.

DFC is a development finance company and an agency of the United States federal government. It primarily invests in development projects in the global south. It uses its lending capacity to give loans, loan guarantees, equity, and insurance for private-sector led projects.

Despite the growth of many agri finance tech startups in the country, a large percentage of India’s small farmers struggle for credit. The demand for food will grow 70% by 2050. The World Bank estimates that at least $80 Bn of annual investments will be needed to meet this demand.

The agri finance industry in India has an estimated market potential of $100 Bn+. Jai Kisan, an Indian rural inclusion agri finance tech company, raised $30 Mn in its Series A round led by Mirae Asset earlier this year.