Ugandan Startup Emata Secures $2.4 Million Seed Fund to Expand Its Agri-Loan Offering Across East Africa

Emata, a Ugandan fintech startup that offers affordable digital loans to smallholder farmers, has secured a $2.4 million seed fund to expand its Agri-loan offering across East Africa.

The seed round comprised $1.6 million in debt and $800,000 in equity funding, and was backed by African Renaissance Partners, Norrsken Accelerator. Other investors include Zephyr Acorn, Marcus Boström, and the Draper Richards Kaplan Foundation.

Speaking on the funds secured, Founder and CEO of Emata, Bram Van Den Bosch said,

“We are thrilled to complete our $2.4 million seed fundraising, backed by high-profile, impact-oriented investors who recognize the huge potential of digital agri-loans in East Africa, and beyond. Emata dares farmers to dream big and eliminates traditional obstacles that have made agricultural finance unavailable for the vast majority. Our solution turns a lifelong struggle into a five-minute process, and is already tangibly impacting thousands of East African farmers.”

Also speaking on its investments in Emata, managing partner at African Renaissance Partners Magdi A. Amin said, 

“We are delighted to back Emata, the digital and affordable solution for East African farmers. Our portfolio is geared toward high-growth companies that use technology to solve real problems that Africans face every day. The startup has a bright feature and we are excited to work with them”.

It is worth noting that agriculture makes up a large proportion of Africa’s economy but is underfunded, which has seen Africa’s full agricultural potential remain untapped. Despite being a cornerstone of African economies, Agriculture only attracts a fraction of the lending.

To address this challenge, Emata launched to address the dearth of Agricultural financing in East Africa. The startup solution allows farmers or cooperatives to manage their production daily and to streamline relations with a bank, up to the credit score, which ultimately allows them to have more access to credit.

Emata uses alternative credit scoring algorithms to identify good farmers and offer loans they can afford.

Farmers enjoy the ease of access to loans on Emata, at a rate that is five times more affordable than the informal loans that have been their go-to option for many years. One interesting thing is that farmers get to enjoy instant disbursement without the hassle of providing collateral.

In June 2023, Emata and the Netherlands Embassy expanded their partnership to boost financing for Ugandan Coffee and potato farmers. The collaboration began with a facility of USD 590,000 to fund loans to thousands of smallholder dairy farmers nationwide.

Since its founding in 2021, the startup has partnered with 43 agricultural organizations and reached an impressive 38,000 dairy, coffee, maize, and oilseed frames.

The startup has provided loans amounting to UGX 3 billion ($810,000) to 2,500 small-scale farmers with UGX 2.5 billion directed towards the dairy sector, and UGX 500 million to coffee, maize, and oilseed farmers.

Emata’s data analysis reveals that smallholder lending has a significant impact, as Emata loans have resulted in an average of 25% in farmers’ productivity.

Despite being less than five years since its launch, Emata’s remarkable offerings saw it awarded the Best Newcomer award in April 2023, for offering affordable digital loans fo smallholder farmers.

Emata is supported by reputable organizations such as Norad, Norrsken, Fsduganda, PLUG AND PLAY, HEIFER Foundation, the LHOFT, Rabobank Foundation, IBM Village Capital, and Agribusiness Development Centre, amongst several others.

Emata invests in farmers and dares them to dream big.