Karachi, March 19, 2025 – To improve financial access for Pakistan’s smallholder farmers, Karandaaz Pakistan, an impact investment platform dedicated to driving sustainable economic growth and strengthening financial and social protection systems, has launched the Digital Financing for Agriculture Challenge (DFAC) – Round 2. This initiative aims to support innovative digital solutions that are meant to create an affordable, accessible, and sustainable formal financing ecosystem for farmers.
With only 22.1% of farmers currently having access to institutional loans, a vast majority remains reliant on informal sources of credit that often come with unfavorable terms and interest rates. Smallholder farmers, who cultivate less than 12.5 acres of land, face an array of persistent barriers such as lack of formal and affordable credit, and negligible produce storage facilities that restrict their ability to deploy optimal farming practices, minimize on-farm losses, and claim a fair price for their produce leading to severely hampered financial growth. Therefore, this challenge round focuses on digital financing solutions that offer collateral-free financing,
electronic warehouse receipt financing, digitalization of the aarthi model, and input financing, enabling farmers to overcome capital constraints and achieve financial stability.
Waqas ul Hasan, CEO of Karandaaz Pakistan, highlighted the urgency for innovation in agricultural finance, stating, "Agricultural finance isn’t just about capital—it’s about systems, sustainability, and scale. Traditional lending structures fail to meet smallholder farmers' needs, limiting their growth. DFAC Round 2 is an opportunity to disrupt this status quo with technology-driven solutions that build an inclusive, efficient, and resilient financial ecosystem. We must bridge this financial gap to ensure Pakistan’s farmers have the resources they need to thrive." Sharjeel Murtaza, Chief Digital Officer at Karandaaz Pakistan, added: "Smallholder farmers make up 90% of the entire agriculture sector of Pakistan yet they remain financially excluded. A sustainable, inclusive agricultural transformation—one that creates equitable economic opportunity, respects limits on natural resources, and gives the agriculture sector the much required technological and financial impetus is the key to Pakistan’s economic growth. DFAC Round 2 calls for innovative solutions that can
trigger the transformation.” Karandaaz Pakistan is inviting fintech and agritech companies, banks, NBFCs, MFIs, and infrastructure providers with innovative financial solutions for smallholder farmers to apply. Eligible proposals must focus on disruptive financial enablement models that ensure accessibility, sustainability, and scalability for smallholder farmers Applications can be submitted via email to dfa@karandaaz.com.pk (Subject: “Proposal Submission – DFAC Round 2”). The deadline for proposal submission is 14th April, 2025. More details at https://www.karandaaz.com.pk/digital/private-sector- engagements/challenge-rounds/dfac .
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