Verqor to Tackle Financial Barriers in the Agriculture

Mexican fintech Verqor raised US$7.5 million to expand its operations in Mexico. The project aims to create the largest network of partnerships of agricultural suppliers in the country. 

The funding round was led by Yara Growth Ventures. Participants included Accion Venture Lab, SP Ventures, Glocal, and Amplifica Capital. In addition to the US$7.5 million gathered during the founding round, Verqor secured an additional US$3.5 million in debt financing from Co_Capital and Addem Capital.

Founded in 2018, Verqor's mission is to offer cashless loans to farmers, allowing them to purchase essential supplies like fertilizers, agrochemicals, and organic products. At the end of the crop cycle, farmers pay back the loan with their produce sales. This credit approach serves as a bridge between various stakeholders in the agro-industry, including farmers, agricultural input suppliers, and purchasers of agricultural products.

According to the startup's data, 55% of its users access credit for the first time through this platform. Verqor's financing empowers farmers to cover up to 90% of their expenses, leading to improved product quality and increased income with each farming cycle. “Verqor is dedicated to making credit accessible to all Mexican farmers through a customized subscription process tailored to the unique features of the agricultural sector,” reads a statement by the company. 

In Mexico, over 90% of farmers lack access to formal financing, which restricts their opportunities to invest and enhance their agricultural endeavors. "Mexican farmers play a crucial role in the global food supply chain, but they lack access to the financial resources needed to produce high-quality crops. With this new financing, Verqor will be able to expand nationally and empower even more farmers in Mexico," says Hugo Garduño, CEO, Verqor.

The poor conditions of the agricultural sector must be swiftly addressed as a matter of national security, says the recently formed “Por Nuestro Campo” movement. “The agricultural sector is responsible for feeding 130 million Mexicans, all while facing significant challenges such as global warming, insecurity, and a lack of financing,” reads a statement by the group. 

Most of the government's current agricultural support programs primarily target small-scale farmers who often require financial assistance, sometimes resembling welfare, says Juan Cortina, President, National Agricultural Council (CNA). Nevertheless, he argues that it is equally vital to extend support to medium and large-scale producers, as they play a significant role in feeding the majority of the population. "We need appropriate public policies that enable the necessary long-term investments for the sector to endure," says Cortina.

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