PasarMikro wants to empower the function of middlemen and create financial inclusion for farmers

The complexity of the agro business supply chain in Indonesia is one of the reasons for the presence of the platform MarketMicro in Indonesia. The company wants to bring the position of traders, such as middlemen or also known as collectors, to a better position.

So far, the perception of middlemen, who also function as traders, has been interpreted negatively by the general public. According to PasarMikro CEO Dien Wong, this perception needs to be changed. Together with Co-Founders Hugo Verwayen (CFO) and Demetrius Edo Djayaputra (COO), PasarMikro wants to empower middlemen and help market access and financial inclusion for farmers. Starting from eggs, Micro Market also has plans to add other commodities.

"Regarding the supply chain, we are still seeing that there are gap before they move the product to a dealer in a big city. There are various layers of the supply chain. We want to provide the best solution through the platform, and we invite supply chain players for on boarding into the platform," said Dien.

According to him, the role middle men or middlemen are still felt necessary by most farmers. So far, middlemen not only help farmers sell their products, but also serve as financial partners and agricultural advisors.

To ensure that the middlemen or middlemen who join are the best, the PasarMikro team curates based on their previous experience. In general, the middlemen or collectors are farmers who have been successful and want to help other farmers. Not only in terms of logistics, these middlemen or collectors also have a key role that often connects farmers to distributors and companies interested in buying certain agricultural commodities.

"We want to make middlemen or collectors the main object in the platform and not try to eliminate their function. We also don't want to replace them. We want to connect them with other farmers and traders," said Dien.

Since launching in 2020, PasarMikro has helped farmers to trade and finance the distribution of more than 5.000 tons of eggs and other commodities.

App development and fundraising plan

PasarMikro also provides various services for farmers and traders for their daily transactions, such as bookkeeping, lending, and a marketplace for farmers and ecosystems to sell their products.

This application that can be used by traders and farmers is expected to facilitate the buying and selling process to the buying process Bidding or initial offer to stakeholder related. Currently, PasarMikro has around 600 active users and 160 farmers. This year the target is to double that number. PasarMikro targets the East Java region for their target market, but does not rule out expansion to other regions.

PasarMikro has a financing business model with a maturity payment scheme for farmers, because they usually do not receive payment for their harvests on time. Meanwhile, with middlemen or collectors they run a profit-sharing scheme.

"In the future, as a platform, there will also be options based on fee and subscriptions are only for those with more needs. But now for all basic usage it will always be free," said Dien.

PasarMikro has also entered into a partnership with BRI and the Rabo Foundation, a social fund supported by European agricultural bank Rabobank with a mission to provide smallholders with prospects for a sustainable future. There are already 4.500+ tons of various types of commodities traded and a payment facility of $6,5 million has been issued.

The company has secured early-stage funding from Gayo Capital and 1982 Ventures as well as several angel investors. This year they have plans to raise funds again.

"PasarMikro looks after Indonesia's main providers, namely farmers and traders who are often overlooked. We are changing the landscape for a more inclusive digital economy. We predict that the digitization of ecosystems enables a scalable future food value chain," said Dien.