ProducePay Developing a More Inclusive Agribusiness IndustryBy María Fernanda Barría | Wed, 06/09/2021 - 12:24
In 2020 agribusiness trade between Mexico and the US reached approximately US$52.9 billion, according to data from the Ministry of Economy. Nevertheless, boosting financial inclusion to support the development of the country has been a constant concern. In an effort to reverse this trend, ProducePay, an agribusiness startup, aims to provide growers and distributors with financing through a platform with transparent information that will ultimately serve as a marketplace.
ProducePay was founded in 2014 by CEO Pablo Borquez Schwarzbeck, who comes from a 4th generation farming family in Mexico and understands the complexity of the market. "The global fresh produce market is opaque, fragmented, and dominated by manual processes, and these obstacles make it difficult for growers and distributors to thrive. We remove these pain points to provide transparency, predictability, and fairness for both growers and distributors throughout the entire product value chain, from seed to sale," said Borquez
The company recently announced a US$43 million funding round and has financed over $3 billion in products across 12 countries in North and South America. In addition, the company also stated that it had doubled its revenues during 2020 despite the COVID-19 pandemic.
According to the company's website, the new capital acquired will be invested in technology development and infrastructure to grow its direct sales team and expand throughout Latin America. One of the company's advantages is the finance and credit provided at every stage of the harvest cycle. It offers flexible payment terms and rapid access to funding that could be ready in two weeks or less. In addition, growers have the option to pay until the product ships to other countries.
The company reports they offer access to market pricing data and analytics with more than 10,000 growers and distributors supplies real-time information that used to be challenging to obtain. Besides, the network provided by the company allows more straightforward and secure transactions for participants in the fresh produce supply chain and establishes network opportunities.
Ultimately the company aims to bring together a fragmented marketplace spread across a vast geographic area. The company explains in simple terms that their Preferred Network fosters profitable long-term partnerships between preferred partners: growers receive better pricing and distributors have access to consistent product supply.
As previously reported by MBN, only 9.9 percent of the 5.3 million rural producers in Mexico have access to credit. Víctor Villalobos, Minister of Agriculture and Rural Development, mentions the importance of finance and acknowledges the difficulties of obtaining them. Even though he stated that it enables more entrepreneurs and producers to develop their products, work toward food self-sufficiency, and improve general agriculture activities, it is still a distant reality for most farmers and growers.