FARMERS have been implored to shift from traditional loan models and embrace value chain financing to sustain agricultural productivity, production and profits and enhance food and nutrition security.
This was said by a consultant, trainer, economic empowerment champion, development finance expert and leader of allWomen.Africa, Dr Mandas Marikanda, on the opening day of the Harare Institute of Technology (HIT) Technovation Expo 2026 last Wednesday.
The Expo ran under the theme: “Designing an assured future.”
In her keynote address at the digital agribusiness supply tech symposium, Dr Marikanda said the agribusiness capital bottleneck stemmed from traditional risk aversion, a working capital trap, high post-harvest losses and inaccessible collateral.
“Commercial banks struggle to underwrite seasonal and perishable risk while working capital is tied up in inventory in transit, storage or delayed receivables.
“Lack of distribution financing leads to spoiled produce and crushed margins. Smallholders, processors and logistics providers lack traditional physical land titles to offer as collateral for loans,” she said.
Dr Marikanda said the above challenges could only be overcome by rethinking agribusiness value chain financing.
Value Chain Finance (VCF) generally refers to funding that flows through established supply chain relationships rather than direct bank-to-borrower loans.
“VCF involves in-chain financing (trade credit, advance payments and supplier credit) and out-of-chain financing (warehouse receipt systems, factoring, invoice discounting and asset leasing).
“The key benefit of VCF is that risk is mitigated by visibility over the trade flow rather than physical collateral,” she said.
The key pillars of distribution and supply finance are Warehouse Receipt Financing (WRF), Receivables and Invoice Factoring (RIF) and Order and Input Pre-Financing (OIPF).
“Warehouse receipts turn stored agricultural produce into liquid collateral, while RIF converts 60-day invoices into immediate working capital.
“OIPF funds input stock and logistics based on verified purchase orders,” explained Dr Marikanda.
She disclosed that allWomen.Africa had introduced a digital ecosystem solution to bridge social commerce and agricultural trade.
“It unlocks value for farmers and merchants, investors and cooperatives and service providers and logistics,” Dr Marikanda said.
HIT Centre for Artificial Intelligence director, Dr Tirivangani Magadza, said strengthening digital supply chains was cost-effective and reduced product losses in agriculture.
“African agriculture is a bucket with a hole in it where we keep pouring in more water, better seed, more inputs, more hectares, while the harvest we already have leaks out on the way to market.
“The fix is not simply more inputs; it is patching the hole, the handling, storage, transport and the coordination between the farm and the plate,” he said.
Dr Magadza said research had shown that about 37 percent of Sub-Saharan Africa (SSA) food was lost from farm to fork, while 45 to 50 percent of fruit and vegetables were lost and a gross value of US$4 billion is lost per year in SSA.
He lamented the fragmented nature of the supply chain composed of middlemen, delays and spoilage and proposed a seamless coordinated chain (digital platform).
FreeTrader chief executive, Mr Innocent Greates, said SSA had broken, dysfunctional agriculture supply chains where smallholder farmers experienced stress from a bumper harvest to an empty wallet.
“We designed and developed FreeTrader to connect the agriculture value chains.
“This agri-business supply chain management platform connects verified farmers with ready-to-buy off-takers, preserving produce value in proper storage and affordable logistics, giving a sure return to customers’ investments,” he said.-herald
