Verqor, a fintech firm pioneering the digital transformation of Mexico's agricultural sector, recently announced a significant fundraising milestone of $7.5 million. This amount encompasses a $4 million pre-Series A round spearheaded by Yara Growth Ventures, with noteworthy participation from Accion Venture Lab, SP Ventures, Glocal, and Amplifica Capital. Additionally, Verqor secured $3.5 million in debt funding from Co_Capital and Addem Capital.
Dedicated to empowering farmers with cashless credit solutions, Verqor's platform facilitates the procurement of essential agricultural inputs such as fertilizers, agrochemicals, and organic products. Remarkably, 55% of its users are gaining access to credit for the first time, underscoring Verqor's role in financial inclusivity. Post-harvest, farmers can conveniently repay the credit through their produce sales, with Verqor's financing covering up to 90% of the farming costs. This financial arrangement not only enhances produce quality but also incrementally boosts the farmers' income with every agricultural cycle.
Anchoring its credit underwriting on a unique methodology tailored to the agricultural sector's specifics, Verqor employs an array of data including normalized difference vegetation index (NDVI) factors, supply chain trends, weather patterns, yield information, and produce price fluctuations to assess credit viability. This innovative approach is pivotal in accurately evaluating farmers' repayment capacity.
Despite being a top ten global food producer, over 90% of Mexican farmers are bereft of formal financing avenues, a gap Verqor is diligently working to bridge. The stark contrast in credit accessibility between Mexican farmers and their counterparts in Brazil and Argentina, primarily due to a fragmented value chain and a digital deficit, accentuates the urgency of Verqor's mission.
The infusion of funds is set to accelerate Verqor's operational expansion within Mexico, aspiring to establish the country's largest network of agricultural suppliers' partnerships, thereby revolutionizing the payment ecosystem for agricultural transactions. The initiative also extends to enhancing Verqor’s technology, aiming to expedite the credit approval process by seven-fold compared to traditional financing mechanisms.
Verqor CEO Hugo Garduño emphasized the critical role of Mexican farmers in the global food supply chain and the newfound potential to scale nationally, thus amplifying the impact on Mexico’s agrarian community. The sentiments were echoed by investors like George Roche, Investment Director at Yara Growth Ventures, and Amee Parbhoo, Managing Partner of Accion Venture Lab, who lauded Verqor's understanding of farmers' needs and its vision to ease their financial burdens.
Juliana De Podestá, Head of ESG and Impact at SP Ventures, highlighted Verqor's technological prowess in democratizing credit access, thereby fostering resilience among small and medium-sized producers against climate adversities and promoting regenerative agriculture.
With this robust financial backing and a clear vision, Verqor is on a promising trajectory to alter the agrofinancial landscape in Mexico, ultimately contributing to the global fight against climate change by empowering the nation's agrarian community.