AwanTunai Now Distributes Agricultural Loans to Farmers at Sayurbox

Startups p2p loans AwanTunai expands financing products for farmers who distribute their crops in Sayurbox. Pilot project already running for selected farmers located in Bogor, Sukabumi, Bandung, and Indramayu.

These two companies are partnered by none other than being sister companies pioneered by co-founder the same, is Rama Notowidigdo. Both have the same ambition to improve the lives of micro-entrepreneurs.

AwanTunai Co-Founder and CEO Dino Setiawan explained, the company is interested in entering this segment because it is in line with its focus on SME financing in the FMCG supply chain and basic necessities.

“In the downstream we have stalls that sell goods to final consumers and in the upstream there are farmers. So farmers are the next MSME group that we serve," he said DailySocial.

Before AwanTunai came in, Sayurbox had never been involved with farmers for working capital financing because so far it was a freelance selling system. Sayurbox Head of Communication Oshin Hernis explained, if farmers need a loan, usually the company will educate and recommend it to Bank BRI Agro as a company partner.

Furthermore, the bank will carry out a selection process based on historical data owned by Sayurbox regarding these farmers. The bank will get a picture for determination credit score before approving a capital loan.

On the other hand, the company also opens a partnership system within one month, if they meet a number of requirements. Such as the quality provided according to expectations and the quantity can continue to be met by the farmer.

“If these two big factors are met, then Sayurbox will offer to become a partner as a form of higher commitment and appreciation. This is one of our selections so that our partners' expectations can continue to be well maintained by our partners in the future," said Oshin.

Regarding its partnership with AwanTunai, for every farmer referred by Sayurbox, there are no specific criteria for which farmers can obtain capital loans. The company only ensures that the farmers who will be referred are Indonesian citizens as evidenced by their ID cards.

"The rest, we provide flexibility for AwanTunai to choose farmers who become our suppliers to get a capital loan facility."

Dino continued, for this collaboration the company provides facilities ranging from Rp. 5 million to Rp. 500 million per farmer referred to by Sayurbox. The tenor is relatively short between 2 weeks to 1 month and the interest is 0,75% per week.

“Loan repayment through virtual account/bank transfer according to maturity. For every return according to maturity will be given cashback by us," he said.

In risk mitigation, the company does not provide financing in cash, but in financing programs in the form of seeds, fertilizers, or other inputs needed for agriculture. This method is believed to reduce the risk of default, as well as learn from previous mistakes.

This method is also used for CloudTempo, a financing product for grocery stores that need additional capital to purchase their store needs. The company cooperates with suppliers to provide financing to the small shop.

“In past agricultural financing programs, misuse of loan funds has been a problem. We want to apply the success of our AwanTempo warung financing program to micro farmers as well.”

This product has been rolled out to selected farmers located in Bogor, Sukabumi, Bandung, and Indramayu. Dino says insight Interesting things found in the field, among which some farmers require upfront payments in order to turn over funds to purchase agricultural raw materials such as seeds and pesticides.

“Schematically this is similar to cash on delivery (COD) without additional time. Meanwhile, for gardens or rice fields, some farmers manage other people's land using a profit-sharing system or a land lease system."

Impact of the pandemic

Sayurbox is one of the players E-commerce especially the leading daily needs in Indonesia. Since its inception in 2016, it has received initial stage funding several times from Insignia Ventures Partners, Patamar Capitaland Tokopedia.

Oshin explained, since the pandemic at the end of March-April yesterday, Sayurbox transactions have skyrocketed due to panic buying from new users. The company had decided to temporarily close the transaction because of this.

“But as time goes on new normal Currently, transactions can be said to be significantly stable even though the current level of competition is increasing,” said Oshin.

In a joint interview Time, Sayurbox Co-Founder and CEO Amanda Cole said during the pandemic the company increased the number of partnerships with farmers from 50 to 100 people to meet the surge in demand.

According to him, the company is lucky to be "famous" and continues to grow exponentially because of the recommendation "Word of Mouth" He hopes that after the pandemic ends, a new habit will be formed for people who are used to shopping for vegetables and fruit online online.