Verqor, a Mexican fintech startup that digitizes the agricultural sector in Mexico, managed to raise USD$7.5 million, of which USD$4 million is part of a pre-Series A round led by Yara Growth Ventures.
Accion Venture Lab, SP Ventures, Glocal, and Amplifica Capital also participated in this round. The startup also secured an additional USD$3.5 million in debt financing from Co_Capital and Addem Capital.
Verqor provides cashless loans to farmers to purchase the supplies they need for cultivation, such as fertilizers, agrochemicals, and organics; 55% of users access credit for the first time.
At the end of the cultivation cycle, farmers repay the credit with the sales of their products.
Verqor’s financing allows farmers to cover up to 90% of their costs, improving the quality of products and increasing their income in each cycle.
It works to make credit accessible to all farmers in Mexico through a unique subscription process tailored to the specific characteristics of the sector.
“Mexican farmers play a crucial role in the global food supply chain, but they lack access to the financial resources they need to produce high-quality crops. With this new financing, Verqor will be able to scale nationally and empower more farmers in Mexico,” explains Hugo Garduño, CEO of Verqor.
It pioneers assessing a farmer’s actual payment capacity using production data, including factors like the Normalized Difference Vegetation Index (NDVI), supply chain trends, weather data, performance information, and product price fluctuations, to evaluate the credit’s feasibility.
Mexico is one of the top 10 food producers in the world, but more than 90% of farmers need access to formal financing, limiting their opportunities to invest in their fields.
“The Verqor team has consistently impressed us with their ability to understand their farmer customers and execute their vision of making farmers’ lives easier.
“We are very proud to invest in Verqor and help them on their journey to change agriculture in Mexico and beyond,” said George Roche, Director of Investments at Yara Growth Ventures.
While farmers in other major economies in Latin America, such as Brazil and Argentina, can access credit through input retailers and other alternative sources, Mexicans often need more access to these options due to a more fragmented value chain and a lack of digitization.
Without high-quality inputs, farmers face decreased productivity and margins, threatening the food supply in Latin America and worldwide.
This funding round will allow Verqor to expand its operations in Mexico and create the largest network of agricultural supplier partnerships in the country, becoming a means of payment for its customers.
The Mexican agricultural industry needs to be more cohesive, and Verqor’s platform bridges the gap between suppliers, farmers, and product buyers.
The startup is also further developing its technology to make its credit approval process seven times faster than traditional financing options, revolutionizing the way conventional agriculture is done in Mexico.
Verqor is a Mexican agri-fintech founded in 2018, offering cashless loans to farmers under the model: get agro-inputs and pay with harvests.
With this credit, it connects the actors in agribusiness: farmers, agro-input suppliers, and product buyers. It offers traceability in the supply chain and access to capital for producers, an underserved but highly productive market.