There are some interesting developments in the crypto / DeFi space, notably protocols like Goldfinch which are pooling capital from investors who want to invest in real-world assets. Recently, Branch, which provides unsecured consumer loans via mobile, secured $10mn to deploy in India at 17% via Goldfinch from Cauris and Almavest.
Given the amount of capital sloshing around in the crypto space, the challenges of rural / farmer group credit in India, we are curious about whether there may be an opportunity here.
Practically, the idea is to come up with a couple “financial product” ideas and gauge liquidity provider (crypto-speak for lender or donor) interest. There are also a bunch of regulatory and currency exchange issues we need to work on in parallel.
With any sort of debt product there is a serious risk that we create more harm than good for farmers and we need to be super wary of this.
Ideas to explore:
Working capital loan for FPOs: See here
Ecosystem Services payments: Go direct to funders and avoid the registries which eliminates complexity and issues like requirement for land records and additionality. Look to Regen Network as a potential partner or analog for generating credits and in addition to corporate buyers, can look to crypto currencies like KlimaDAO and Celo that want to purchase offsets for their treasuries.
Sustainability finance: Help de-risk adoption of CSA practices by providing capital during a 2-3 year “transition” period. Maybe link w a certification standard if we believe that might help with price realization once the transition is complete. Might overlap with (2) above