Nigerian tractor-booking platform Hello Tractor has raised US$1 million in funding from Heifer International to provide loans for tractor purchases which can be repaid from revenues earned by leasing them to local farmers.
Hello Tractor has rolled out a tracking device and software that allows farmers and tractor owners to book connected tractors from their phones. Farmers get a critical service formerly unavailable to them, and owners see a fleet optimisation opportunity that also minimises fuel theft and fraud. It currently serves over 500,000 small farmers across Africa with over 3,000 tractor and combine owners.
It has now raised US$1 million in funding from Heifer International, which supports farmers and local food producers to strengthen local economies and build secure livelihoods that provide a living income. The cash is funding a new programme, “Pay-As-You-Go (PAYG) Tractor Financing for Increased Agricultural Productivity in Nigeria,” which has already enabled tractor purchases in the Nigerian states of Nasarrawa, Abuja and Enugu.
“We 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,” said Jehiel Oliver, founder and CEO of Hello Tractor.
Oliver said that partnering with Heifer “enables us 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.