Nigeria-based Hello Tractor , a tractor-booking platform, has raised a $1 million investment from Heifer international.
This funding will be used to provide loans for tractor purchasing which can be repaid from revenues earned by leasing them to local farmers. Hello Tractor will use this raise to expand its pay as you go (PAYG) platform to provide smallholder farmers with the much needed capital to engage in farming.
Hello Tractor has been around since 2014 with Jehiel Oliver doubling as founder and CEO. The platform seeks to connect farmers with owners of farm equipment. For the tractor owners, Hello tractor provides them a means of earning income whilst the renters get to tackle labour constraints that would have resulted in late planting, underutilization of farmland and delayed harvest.
Hello Tractor’s PAYG model serves the smallholder farmers who are usually cut off from the commercial banking system and neglected by private equity investors.
The startup also provides remote tracking of assets, preventing fraud and machine misuse, through virtual tractor monitoring. Hello Tractor’ has a tracking device and software that allows farmers and tractor owners to book connected tractors from their phones.
Since its inception, Hello Tractor has worked with 500,000+ farmers using 3,000 tractors on its marketplace. The startup has also established its presence in 15 countries.
Jehiel Oliver, developed the PAYG programme to make tractor ownership – and the reliable income these machines can bring – a reality for entrepreneurs who find it impossible to get credit through normal channels.
“We look at the revenue tractor owners can generate, not how much collateral they can pledge, ” he said.
Partnering with Heifer International will enable Hello Tractor “to extend innovative financing to people who were previously considered ‘unbankable,’ while increasing access to technology that has the potential to improve the incomes of millions of smallholder farmers across Africa.”
Adesuwa Ifedi, senior vice president of Africa Programmes at Heifer International, said the PAYG model provided financing for entrepreneurs who want to create jobs by capitalising on the demand for tractor services on Africa farms, but who lack traditional forms of collateral.
“It’s a way to unlock capital for youth who have strong business skills that can help transform African agriculture but are often overlooked by private equity investors,” Ifedi said.