Smallholders are crucial to food production in Africa. An estimated 33 million smallholder farmers account for 80% of food production in sub-Saharan Africa.
However, while sub-Saharan Africa accounts for a quarter of the world’s farmable land, it only contributes 10% of global agricultural output. While much of the world is going above and beyond in farm output, Africa’s farmers are lagging behind, with many countries spending up to $35 billion on food imports annually.
“One thing we noticed is 65% of Africa’s arable land remains underutilised, and there are a combination of challenges, like a lack of mechanisation services to the farmers and also a lack of equipment for those farmers to get access to mechanisation services,” Rispa Miliza, Digital Sales Lead at Hello Tractor, tells Techpoint Africa.
Recognising this opportunity, Jehiel Oliver, Founder and CEO of Hello Tractor, has been on a mission since 2014 to transform small-scale agriculture through affordable access to mechanisation.
“The idea was to ensure that smallholder farmers get as productive as possible using the agricultural lands and also that we scale that up to achieve global food security,” Miliza says.
The Uber of tractors
Hello Tractor, a Kenyan agricultural technology company, is committed to mechanising farming for smallholder farmers across Africa. Similar to a ride-hailing model, Hello Tractor introduced an on-demand tractor-hailing model connecting smallholder farmers with tractor services.
The model is rooted in the realisation that tractor owners have the equipment to make farming easier but no direct way to reach farmers who need their services, and farmers need tractor services but do not know how to get them.
Hence, Hello Tractor became the middleman. With an app for booking tractors and booking agents in rural areas, farmers and service providers can easily access each other.
“Farmers are able to request tractor services in two main ways. One of the ways is that they can directly contact the Hello Tractor customer support lines, where anyone can request services.
“However, to make it more sustainable and scalable, we work closely with booking agents. Booking agents are individuals who come from farmer communities,” says Miliza.
Miliza explains that they can serve them adequately because they come from the same communities as these farmers and have built relationships with them over time.
This method of using booking agents reduces the friction that farmers, particularly less educated ones, may have with using apps and websites to book tractors. The agent books tractor services on behalf of the farmer, including all their details like location, farm size, and the service date, and this information is used to connect them with the nearest available tractor to service their farms.
“If a farmer is not aware of a booking agent within their location, we have what we call mechanisation hubs that they can also walk into and book for the services they require,” Miliza adds.
Hello Tractor’s peace of mind technology
Connecting tractor owners to farmers is just one side of Hello Tractor’s innovation. The company created a technology that allows tractor owners and service providers to track the use and movement of their tractors while on the field.
With a high-sensitivity hardware monitoring device attached to a tractor, service providers can track their tractors from the app, including their fuel consumption, location, and active and idle time.
Pay-as-you-go tractor financing
A key innovation is Hello Tractor’s Pay-as-you-go (PAYG) financing. The financing programme was launched in 2022 and is currently operational in Nigeria, Kenya, Uganda, and Rwanda.
Access to finance across Africa, especially for smallholder farmers, continues to hinder productivity and business growth.
Hello Tractor’s PAYG model allows farmers, agents, and entrepreneurs to own tractors, with only a 5% down payment, and an aggregated booking of 500 hectares of farmland on the Hello Tractor app in a year.
“We have cases where we are able to waive the 5% down payment. The top requirement is usually for them to aggregate 500 hectares, mainly because we also want to increase the mechanisation of services to farmers. So, if they can show us that the demand exists and they book through the application, then they join the pipeline to start ownership,” Miliza says.
Miliza adds that when the PAYG financing programme was launched, most applicants were smallholder farmers who could not access equipment financing from traditional financial institutions.
“It’s an aspiration for most of them to own the equipment, and Hello Tractor also helps them understand how they can make a business and become entrepreneurs by owning the equipment.”
Social impact
After over ten years, Hello Tractor’s impact is undeniable. With a footprint in 15 countries across the continent, the company has digitised over 3.5 million acres and unlocked five million metric tonnes of food production.
In Kenya alone, where Hello Tractor has partnered with the country’s agricultural ministry, over 700 tracked tractors with 1,100 booking agents now serve more than 360,000 smallholders, opening 690,000 acres to cultivation. Across Africa, the network now spans about one million smallholder farmers.
