Use of technology in agriculture services in Bangladesh

E-commerce in agriculture

E-commerce in Bangladesh has reached a more significant milestone. It has reached the agricultural sector in the country as well. A lot of businesses have come forward to help out farmers so that they can get a fair price for their goods. These businesses include iFarmer, Fashol, Deshifarmer, etc. The core business idea of these companies is to promote the fresh produce of these farmers. That is why they created these platforms for these farmers to sell their goods directly to the customers (Ovi, 2017). The farmers in the country did not have any platform where they could have the advantage to sell their produce, and now they do. Before the E-commerce platforms began, the farmers hardly had any opportunity to set prices for their produce. With the help of these E-commerce platforms, farmers now have the chance to negotiate the prices of their produce with customers directly (Ovi, 2017). For these reasons, Bangladesh has achieved much in the agricultural sector, ranking 147th out of 176 countries worldwide. The use of digitization in agriculture has helped to increase this sector’s productivity and efficiency. It has also allowed for more accessibility of services to the country’s farmers. In addition, there are a lot of agricultural services now because of E-commerce has provided a lot of facilities for the farmers in the country, such as better access to information regarding the market, weather forecasts and conditions, and, most importantly, access to cost-effective financial resources (Rahman, 2023). The use of mobile phones, various apps, and online services have enabled the farmers of Bangladesh to access real-time weather information, which is also helpful for them to plan for their crops, carry out crop management methods, and set the prices of their produce for the markets (Rahman, 2023). Therefore, because of the online platforms and companies that are aiming to help the agricultural sector of the country, agriculture E-commerce now has a lot of potential to improve the financial conditions of farmers by reducing expenses such as intermediary costs and therefore facilitating a direct commercial between producers and buyers (Chakraborty et al., 2022).

Smart agriculture: Scenario of iFarmer

iFarmer is a prominent agri-fintech firm in Bangladesh that connects finance and agriculture by allowing anyone to become farm sponsors, interact with farmers, and invest in agriculture digitally. They mainly prioritized the farmers. Their platform offers integrated services such as financing, input access, timely advice, a high-quality supply chain, and market access to improve farmers’ lives and earnings. The most extensive coordinated, based-on-demand supply network for fresh agricultural products is being built in Bangladesh by iFarmer. They take total control of the supply chain and link farmers and customers directly. One of the best services is local farmers, who are also taught by the professionals at iFarmer how to make better judgements and decisions about this business sector. One of their primary activities is to enable digital lending services to farmers and Agri MSMEs. It is now known as a one-stop solution for smallholder farmers.

They started this business approach by locating low-cost funding for those interested. Firstly, the Agri MSMES needs to sign up for the iFarmer app, fill out all the personal information, and share transactional data to apply for a loan. These people could then select which farm and farmers they wanted to support and donate to them while being able to follow those farms’ development through a mobile app (Tonmoy, 2023). After that, to provide finance for micro-, small-, and medium-sized companies in the agriculture sector, such as farmers, traders, input retailers, and other agriculture enterprises, they collaborate with financial institutions and lending partners like banks, micro finance, investment groups, non-banking financial institutions, and insurance companies. They determine the economic viability of the consumers using alternative data and a customized credit score system. The applications are to be approved by their lending partners, who immediately transmit the money. Aside from that, they are assisting in the releasing of funds from individuals who wish to engage in agriculture initiatives and make good returns while also making an impact. So, farmers collaborate with these Agri MSMEs, offering them consulting services, education, and data gathering and monitoring to ensure their companies are successful and able to repay the loan on time.

Along with new agricultural insurance products, iFarmer is also creating satellite- and sensor-based advising services and farm mechanization services. They are utilizing the latest innovations, including IoT sensors, soil sensors, and two applications, Sofol and KriShop (Figure 1). Through their Sofol app, the company’s field facilitators are connected to certified farmers. Farmers may use the app to submit money requests, follow farm upgrades, do KYC on them, and collect more data, allowing iFarmer to build a customized profile for each farmer. Additionally, the software assists in creating a risk evaluation for the farmers, which ultimately enables them to obtain additional financing from financial organizations like banks and insurance firms. They can also get satellite-based weather updates by using this app. The app functions offline because many agricultural finance requests come from distant locations without an internet connection.

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Figure 1.

Two significant apps of iFarmer.

Another iFarmer digital platform for input sellers is KriShop, which provides door-to-door delivery of premium products essential to their operations. An input merchant may use KriShop to place orders from a customized pricing list according to their locations. They can pay with cash or a credit card, and similarly to other delivery applications, they can track the package as it proceeds. For farmers to access the highest quality agricultural input, the iFarmer field facilitators link them with this retailing network. According to the current data, iFarmer has helped farmers in Bangladesh receive around 2.19 billion BDT in finance. About 202,000 tons of agricultural goods have been sold through this platform. Furthermore, Sofol has almost 92,000 farmers, including 50,304+ male and 42,175+ female farmers. Thus, iFarmer not only helps farmers in generating revenue but also supports our country in growing economically.

Smart agriculture: Scenario of WeGro

With a mission to enhance the lives of everyone involved in the agricultural supply chain, Bangladeshi Agri-Fintech Company ‘WeGro’ links farmers with investors through technology. In return, it offers investors the chance to make solid investments with high returns on farms and the chance to enhance the agricultural manufacturing process. They follow a Shariah compliant investment process. They essentially serve the farmers who lack sufficient access to financing. The company gives farmers access to markets, investors, high-quality input, and the essential information. WeGro offers credit help to farmers by using idle cash from urban investors, buying high-quality agricultural inputs (livestock, seeds, calves, etc.), and loaning these inputs to the farmers. But they never provide direct cash to the farmers at first. They would instead provide them a calf or a few seed bags. Their main concern is farmer profitability, and they offer the farmers the necessary training, advice, agro inputs, insurance, storage, transportation, and market access when the output is generated. WeGro then buys the crops or an animal back from the farmers and sells them to marketplaces in urban areas. They sell the goods to their partners’ (Figure 2) like Chaldal, Khaas Food Ltd, Parmeeda, IFRI, Bidyanondo Foundation etc. once the intended output or item has been produced, guaranteeing fair pricing for the farmers. They pay the capital and profit to the investors out of the sales revenues and keep a certain commission from the profit (Ahmed, 2023).

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Figure 2.

Partners of WeGro.

Their slogan, ‘Investing in agriculture, simplified’, made it easier to finance agriculture. Through the WeGro App, one may now finance agricultural projects or support a farmer who lives in a rural location while sitting at home. WeGro provides an Android and iOS mobile app platform for users to support agricultural initiatives encompassing cattle, poultry, fisheries, vegetables, etc. WeGro is cooperating with roughly 1000 farmers nationwide on programs in Sirajganj, Pabna, Natore, Keraniganj, Kishoreganj, and other areas (Shafin, 2022). Anyone with a smartphone and money may invest in various farm industries using its agricultural fintech strategy. Thus, by developing a Digital Agricultural Financing Platform, WeGro seeks to close this gap between farmers and investors. Through their app, an investor can easily monitor everything and their investment properly.

Smart agriculture: Scenario of Agroshift

Agroshift, one of the top agricultural companies in Bangladesh, is trying to help farmers sell their goods to businesses and customers by developing a tech-enabled supply chain that connects the real and digital worlds. Their strategy removes the need for retail touch points in favour of digital ordering and lean drop-off stations within plant premises, resulting in massively increased efficiency. They aim to change the agricultural value chain so that customers may buy fresher, safer products while farmers receive greater profits and fair pricing. In a micro-fulfilment approach, Agroshift works directly with farmers and dealers to supply necessities, including fruits, vegetables, cereals, and meat. It enables employees to obtain economical, high-quality fresh food directly. On their website, they guarantee to serve safe food. Currently, the company provides four different products such as grains, vegetables, meat, and fruits. It also has intentions to start selling fish soon. Farmers offer fruits, vegetables, and heart, while mills provide grains like rice and lentils. The companies produce edible oil, sugar, flour, and other goods (Haque, 2022).

Their consumers use a web or mobile application to place online orders. By matching demand with supplies from our farmer networks, their technology fulfils the order. The local Agroshift collection centres are contacted through SMS or call to accept the farmers’ produce in exchange for immediate payment. The goods get delivered to the distribution centre from the collecting hubs, where they are gathered, packed, and distributed straight to customers or clients. Farmers have access to information about market prices because of their platform. Farmers do not need to meet with any middlemen because of using this platform. They use Agroshift as a mega middleman to collect the products from the farmers and transport them to the customers, ensuring zero waste because they only take pre-orders. Thus, farmers will get a fair price and revenue, while customers will receive fresher and safer products through Agroshift.

Smart agriculture: Scenario of Deshifarmer

Deshifarmer is another company that aims to connect producers and retailers through its online platform and business model. It works on a B2C basis. In addition, Deshifarmer provides farm-to-business supply chain automation, which consists of demand forecasts, delivery tracking, payment tracking, inventory tracking, and reports. Their micro entrepreneur’s app is developed to communicate with the farmers to avail the services regarding agri input, agri finance, crop insurance, and crop staging. The company also has a multi-vendor type marketplace where the micro-entrepreneurs communicate to purchase agri inputs and sell their produce to the Deshifarmer buyers. This marketplace technology includes accurate time market information, buying and selling agri products, logistics, and safe payment systems. Additionally, the company also has a retailer’s app consisting of all of these similar services. There is also an app for tracking expenses, which makes it easy for farmers to keep track of their income and expenses.

Smart agriculture: Scenario of Fashol

Fashol is another digital platform that aims for the betterment of the farmers of Bangladesh. Fashol is helping the farmers by creating direct access to the market and transactions through its physical farmer centres. For its website, the online platform uses around 30 technologies, some of which include SPF and Content Delivery Networks. The company also has mobile applications named Fashol Seller and Fashol Retailer. Under its network, it has over 5000 retailers working with them. It also ensures doorstep delivery of products, which is convenient for retailers.

Benefits of smart technology in agriculture sector of Bangladesh

Agriculture is an essential component of the Bangladesh economy. Nearly half (about 47%) of the working population depends on this industry despite it making up just 16% of the GDP. So, it becomes vital to adopt the implications of technology in the agriculture sector. With a significant portion of its people engaged in agriculture-related activities, Bangladesh has significantly improved the agricultural sector. Currently, various startups are working on smart technology for the agriculture industry and striving to offer the finest solutions to individuals working in the sector. Technology plays a significant part in farming and agriculture, helping minimize losses and boost productivity (Figure 3).

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Figure 3.

Benefits of smart technology in agriculture sector.

The employment of digital and analytical tools fosters continual development in agriculture, enhancing crop yields and contributing to the agricultural community’s revenue. By using the technology in this sector, the farmers are becoming more efficient. By working with these agri-tech companies, they can easily acquire funding, proper market access, and consulting services and reduce the cost of intermediaries. Furthermore, smart technology helps collect data and information on crops, soil, and weather conditions. Then, it enables us to use that knowledge to make intelligent planting, harvesting, and other agricultural decisions. Technology utilization could also help farmers access information and market prospects, resulting in higher earnings and business growth. Other than using precision agriculture and IoT (Internet of Things) trends, our agri-tech companies should introduce more AI (artificial intelligence), greenhouse automation, and machine learning trends in their businesses so that they can provide better services to farmers and others who are involved in this sector (Dawn et al., 2023). Thus, intelligent technologies not only help farmers better their livelihoods and economic situations, but they also help to increase the productivity of Bangladesh’s whole agricultural industry.

Case synthesis

Bangladesh and its farmers have benefited significantly from agricultural technology because of particular companies that came forward to offer help. However, despite the advantages, challenges still exist. Climate change is a considerable limitation in agriculture, and technology has no control over it. Farmers are primarily dependent on and are used to traditional farming techniques. They are usually adamant about using new methods, as technology is unique to them (The Future of Agritech in Bangladesh, 2023). As agri technology offers real-time information, network and internet issues remain there despite expanding the network. As this entirely relies on technology, the companies must also depend on the network and connectivity level to interact with the farmers daily. Rural areas still have limited access to technology and often have connectivity problems, which is why it may be challenging to have access to real-time data (AgroTech in Bangladesh: How Technology is Disrupting Traditional Agriculture Practices- Part II, 2020). They also lack infrastructure. Most agri-tech companies offer apps which require smartphones, and the farmers are not always educated enough to operate and understand smartphones or applications. These companies provide advanced agricultural practices, which require large amounts of investment, and farmers may often feel discouraged to work on the projects or with the companies. However, the use of technology in agriculture has the potential to completely transform Bangladesh’s agricultural industry by addressing significant problems and improving farmers’ profitability and effectiveness.