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South African banks are becoming more embedded in the everyday tools farmers use to run their operations rather than stepping in only when financing is required, according to Nedbank Commercial Banking.Financial institutions are increasingly building themselves into the digital systems farmers already use, said Desry Lesele, senior manager for agribusiness client value propositions at Nedbank Commercial Banking. She pointed to Nedbank’s partnership with online agricultural marketplace PrysWys as an example of this shift.Nedbank’s agribusiness division said it has recorded an 80% increase in users on PrysWys, which it partnered with last year. The bank did not disclose absolute user numbers.Through PrysWys, farmers can request quotes, compare prices, place orders and access pre-approved financing for fertiliser, seed, livestock feed and fuel from a network of suppliers on the platform.Nedbank said the partnership was designed to close the gap between farmers buying inputs and paying for them, and that it has improved price discovery and access to inputs, particularly in areas where availability can be a challenge.Lesele said embedding finance directly into platforms such as PrysWys means funding is available at the point of purchase, instead of through a separate application process.Lesele, citing research by the UN’s Food and Agriculture Organisation (FAO), said the shift is being driven by pressure on farmers to improve productivity while managing greater uncertainty. She pointed to rising input costs, tighter margins, volatile weather and fluctuating commodity prices, alongside growing demands from customers and financiers for efficiency, traceability and sustainability.Nedbank pointed to World Bank data showing that just under 80% of South Africans have internet access, alongside near-universal mobile phone use, as infrastructure that supports the shift toward digital agriculture.The bank cited earlier research suggesting that only about 26% of smallholder farmers were using digital technologies, a figure Lesele said is rising as tools become more useful and accessible.Lesele said the growth in PrysWys users reflects farmers becoming more comfortable managing parts of their businesses online, describing it as part of how farms now operate rather than a side activity. She said that as adoption grows, digital platforms have the potential to improve the efficiency, transparency and competitiveness of the broader agricultural value chain.She added that as more agricultural transactions move onto digital platforms, they also generate a more detailed picture of how farm businesses operate. This can, over time, give financial institutions a better understanding of their agricultural clients, potentially enabling more tailored financial products, faster credit decisions and more responsive risk management.Nedbank said the shift does not amount to a replacement of how farmers have traditionally operated. Farmers still rely heavily on agronomists, advisers and long-standing supplier relationships, with digital platforms functioning alongside those relationships rather than in place of them.The bank also acknowledged gaps in the model, with not all farming areas having access to reliable connectivity, and levels of digital confidence among farmers vary widely. Lesele said those gaps would need to be addressed if digital agriculture is going to work for the whole of the sector.Lesele said producers are increasingly incorporating digital platforms into how they manage risk, control costs and grow their businesses, with the potential, as more platforms become interconnected, to build a more efficient and financially inclusive agricultural ecosystem for producers, suppliers and financiers.This digital shift is also not confined to the input-buying side of the supply chain. On the selling side, marketplace app eFama connects farmers directly with buyers locally and abroad.As of March, the platform had about 6,000 buyers and a pipeline of roughly 5,000 farmers, with demand extending into the rest of the continent, Europe, the Middle East and North America. Co-founder and CEO Shadrack Kubyane said the platform’s longer-term ambition is to reach South Africa’s roughly 2.3-million farmers, many of whom still struggle to access reliable markets.The growing attention on South Africa’s agritech sector was reflected in eFama co-founder Pretty Kubyane being named winner of the Veuve Clicquot Bold Future Award in July.Business Times
