How Economic Identities Facilitate Lending to Smallholder Farmers: The Case of Rural Loan in Papua New Guinea

In September 2021, with the support of the GSMA AgriTech programme, an agribusiness, an agritech company and a microfinance institution joined forces to pilot a first-of-its-kind loan product for smallholder farmers in Papua New Guinea. The product, branded “Rural Loan”, uses farmer data generated by a digital procurement app in agriculture to create economic identities for farmers and a credit scorecard for the local microfinance institution to assess risk.

This case study shares some of the key lessons from the Rural Loan pilot, which will be of interest to other agritech ecosystem players interested in launching digital financial services for smallholder farmers. Specifically, the case study is aimed at agribusinesses and financial service providers in Papua New Guinea and other low- and middle-income countries looking for viable ways to extend credit to rural populations.