Grace Ashiru
Emata, a startup from Uganda that provides cost-effective loans to farmers, has successfully secured seed funding of $2.4 million. This funding will be channeled towards broadening its agricultural loan services throughout East Africa. The seed funding comprises $1.6 million in debt and $800,000 in equity. This funding intends to bolster Emata’s services in Uganda and pave the way for its entry into Tanzania.
This funding round garnered support from African Renaissance Partners, Norrsken Accelerator, and the Draper Richards Kaplan Foundation and also saw contributions from angel investors like Marcus Boström and Zephyr Acorn. In the previous year, specifically June 2022, Emata was recognized as one of the nine African startups that were chosen for the Norrsken Impact Accelerator.
Agriculture is responsible for 23% of the GDP in sub-Saharan Africa. This percentage could be higher if the small-scale farmers in the region had better access to resources. There’s a $240 billion agricultural finance deficit in Africa, leading many farmers to depend on high-interest bank loans. Emata steps in to bridge this gap by providing loans without the need for collateral to these small-scale farmers. They collaborate with cooperatives and farmer-centric organizations to facilitate automated loan provisions. These collaborations also assist Emata in the loan recovery process from the farmers.
Bram van den Bosch, the Founder & CEO of Emata, expressed his excitement about the seed funding. He stated, “We’re elated to finalize our $2.4 million seed funding, supported by renowned, impact-driven investors who see the immense potential of online agricultural loans in East Africa and beyond. Emata encourages farmers to aim high and overcomes conventional hurdles that have rendered agricultural finance inaccessible to most. Our approach transforms a lifelong challenge into a swift five-minute procedure, already making a significant difference in the lives of numerous East African farmers.”
