Banks fund agricultural technology companies for rural lending

YES Bank said it was partnering several fintechs to offer differentiated banking services in rural pockets of the country

Banks are now increasingly looking at leveraging agricultural technology to facilitate rural lending.

They have even partnered agri-tech companies, which are creating a credible database on farmer behaviour, helping agriculturists get the best prices for selling their produce, and enabling satellite mapping.  

  

Rural lending has, for long, been a neglected area because of it being a high-cost and low-margin business. Traditionally, loans were disbursed after due assessment of farm land.

This often required physical visits - an expensive affair for banks and financial institutions. Agri-tech solutions, however, are meant to reduce this and make it efficient and cost-effective.

YES Bank has