According to the 2001-11 Indian census, 22% of our population are farmers or agricultural labourers. Due to fragmented land holdings and regressive farming methods as well as the country’s recent unreliable weather and rain patterns, many of our farmers have descended into poverty despite farm output growing. This essentially folds out into a vicious cycle where even farmers want to adopt mechanised farming practices they lack the money and access to such farm equipment and vice versa.
This was Alekh Sanghera’s grandfather’s lament. An octogenarian farmer, he wondered why India’s much lauded technological development was unable to come up with ways to breakthrough this destructive cycle. Spurred to action, Alekh came upon the idea to have farmers lease out their farm equipment to those who could afford to purchase them. This resulted in better utilisation as well as income generation. He speaks to Networked India about his startup farMart‘s unique model as well as how it is changing the lives of our farmers for the better.
Networked India (NI): farMart is about sharing/renting farm equipment by farmers with farmers. What led to the creation of farMart?
Alekh Sanghera (AS): Every quarter , I would make it a point to visit my grandfather in his village in Punjab. The visit would entail lengthy conversations about the hardships faced by farmers in today’s time. During one of my visits in 2015, my grandfather said:
Farming is no longer a respectable and profitable business. With all the technology revolution happening in the world, the world does not help farmers with their problems.”
This broke my heart. My grandfather is an active 88 year old and had been farming for the last 60 years. Given all the hard work farmer puts in to produce the food we eat, he is not provided with any support. I soon realized that in order for farmers to be profitable they needed to generate alternative sources of income and reduce their operational expenditure. Road to both lies in increased farm mechanization. I embarked on a journey to solve farmer problems and brought on board my childhood friend Mehtab and mentor, Lokesh. Both of whom shared a similar passion for farming.
The three of us realized that farmers faced serious issues in accessing agri-equipments (tractor, tillers, harvesters, etc) at affordable prices. In India, 75% of farmers own less than one hectare of land. Such small landholdings make it unviable for farmers to own machinery/equipments solely for their own purpose. Farmers rent machinery from individuals who commercially rent out their machinery. However, the market is highly unorganised and most of the times, the farmer does not find machinery, which often leads to lower yields or crop loss. To solve this problem, Alekh, Mehtab & Lokesh founded “farMart”
NI: How does the farMart model work and what kind of response did you get from farmers initially?
AS: farMart’s working model is simple. We provide a platform where farmers can rent out their under-utilized machinery to fellow farmers who are in need. Farmers are able to increase their agricultural productivity, at the same time machinery owners can generate an alternative source of income on their asset. Since we were able to utilize the under-utilized machinery of large farmers, we were able to offer services at cheaper rates. This reduced the input costs for farmers significantly. Farmers were very happy to receive quality services at their doorstep via farMart. Now they could focus on their farming activities and maximize their crop output.
NI: Farmers are expected to get in touch with each other via your site and app. What about the less tech-savvy farmers?
AS: Farmers can book machinery via our call center also. We understand that there will be a significant portion of farmers who are less tech-savvy and would prefer booking through phone call. But we look towards the future. By 2021, over 800 millions Indians are expected to own a smartphone. The market is progressing at a very fast pace. Therefore, we have launched a mobile app which is extremely user-friendly and ensures a quick and frictionless booking process.
NI: farMart introduces revolutionary features like ‘Prices tailored according to farmers usage and need’ and payments via United Payments Interface. Tell us more about these.
AS: We understand the needs of our farmers very deeply. Our prices are tailored according to the regions depending on the soil type. This helps farmers to save cost and time.
250 million Indians have opened a bank account under PM Modi’s flagship Prime Minister Jan Dhan Yojna (PMJDY). With this as a foundation along with the rollout of Unified Payment Interface (UPI), the dream of cashless India can truly be realized. Farmers will be able to make payments simply using their Aadhaar number, virtual ID or phone number.
NI: Give us some background on the founders.
AS: I, Alekh Sanghera, am the co-founder & CEO of farMart. I am 24 and have a Bachelor’s in Engineering (Mechanical) from Sir M Visvesvaraya Institute of Technology, Bangalore. I come from an army background. I have experience as a digital payment consultant with a multinational financial inclusion consulting organization named MicroSave as well as cross country experience (Asia & Africa) working extensively on variety of projects with international donors- Gates foundation, World Bank, UNCDF- and Government of India apparatus.
Mehtab Singh Hans, 25, is my co-founder. He is a Bachelor of Business Administration (BBA) from Christ University Bangalore and hails from a family of farmers from Punjab. An avid basketball player, Mehtab was a Consultant with the National Institute of Public Finance and Policy (NIPFP) before joining farMart. He provided research support to the Finance Ministry and the Warehousing Development & Regulatory Authority on matters related to financial regulations and organization strategy. Prior to NIPFP, Mehtab worked as a risk and product analyst at Goldman Sachs.
Lokesh Singh, 37, is the COO & Mentor with an MBA from Institute of Rural Management Anand (IRMA) and a Bachelor’s in engineering. Lokesh has over 17 years of managerial and entrepreneurial expertise. He is a digital payments principal consultant with MicroSave. In this capacity, he has led important engagements with the Ministry of Agriculture, Rural development, Petroleum and Natural Gas the UIDAI (Aadhaar).
NI: How many districts/states have you covered since beginning operations in Feb 2016? How many farmers have benefitted from farMart?
AS: We are at the proof of concept stage and currently operate only in 10 villages in Saharanpur district. We have provided services to 250+ farmers till date.
NI: How challenging was it to convince farmers to share their equipment with their neighbours? What about the response from banks who provided the finance to buy/lease these equipments? How did you manage these challenges?
AS: Most of the farmers bought machinery on loans. Since machinery has very limited usage and remains idle for a greater part of the year, farmers face problems in order to pay back their loans. farMart helps them generate an income on an asset which would otherwise be lying idle. Since, machinery owners themselves or their drivers service the farmers, they are able to use the machinery carefully and avoid any breakage. We individually met each machinery owner and explained the benefits of joining our platform. Initially only a handful were interested in joining our platform. However, after seeing the machinery owners on our platform doing well, other machinery owners were quick to join our platform. The value proposition offered by farMart made complete sense to the machinery owners.
NI: What is the long term vision for farMart? How do schemes like Startup India & Make in India factor into your future vision?
AS: farMart aims to change the way farming is done in India and hopefully across the world. Since we leverage existing market supply of machinery rather than procuring machinery, our model is highly scalable. We plan to launch our operations in 5 states of India in the next 3 years. Schemes like StartUp India has some tax and funding benefits for startups. However, we expect more support towards agri-tech startups given that over half a billion people are engaged in agriculture in India.