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Lexasure Financial Group Limited (George Town, Gran Cayman) a provider reinsurance, insurance, and InsurTech solutions in South and Southeast Asia, and AgriG8 Pte. Ltd., a Singapore based Agri-Fintech platform intended to make it attractive for institutional lenders to invest in climate-resilient farming, have announced a memorandum of understanding for a proposed strategic partnership to enhance the financial ecosystem available to Indonesian rice farmers, their suppliers, and related financial institutions.
Under the terms of the agreement, AgriG8’s technology, enabled by Lexasure’s insurance solutions and its partner network of financial institutions that includes banks, microfinance organizations, and other lenders, will offer Indonesian rice farmers access to loans, electing crop insurance, and several farm advisory services through a convenient mobile phone application, while crop monitoring and yield prediction will be available to all stakeholders. Farmers will also be introduced to Lexasure’s Flourish mobile application, a separate technology aimed at helping farmers in Southeast Asia stabilize their income, where approved individuals will be able to easily enroll in, manage, and obtain support for their insurance policies.
“AgriG8’s unique ability to turn agricultural data into economic opportunity and climate-focused transformation in rural farming communities has driven strong growth for our company since our inception two years ago,” comments David Chen, CEO, AgriG8. “There are over 20 million smallholder paddy farmers in Indonesia, and their farming practices have an enormous impact on the nation’s food security and carbon footprint. Aligning ourselves with Lexasure not only enhances the products and safeguards available for farmers—it will also broaden the network of participating financial institutions and increases our ability to drive sustainable change in the agriculture sector.”
The proposed strategic partnership is designed to leverage AgriG8’s proprietary appraisal system to identify and engage with high-quality farmers, digitally mapping out farm boundaries, developing analytics to calculate yield predictions, and determining required loan sizes, while helping the farmers to strategically improve nutrient efficiency. The model is intended to lower engagement costs and improve risk mitigation while providing Lexasure and the participating lenders, suppliers, and distributors with a platform to develop tailored opportunities for the previously underserved market, according to a statement from the companies.
Digital Transformation of Farming Communities
“Our partnership with AgriG8 is designed to accelerate the digital transformation of rural farming communities in Indonesia and provide our financial partners access to a market that is strongly aligned with ESG and impact investing mandates in a transparent and verifiable manner,” says Ian Lim, CEO, Lexasure. “Our insurance and advisory products will empower local farmers while providing protection and resilience that was previously inaccessible.”
The companies report that a pilot trial will be run in each potential geographic region in Indonesia to determine business viability and sustainability potential. The farmlands near Cilegon in the Banten provinces, close to the city of Jakarta will be the site of the inaugural trial.