Ripple Impact is excited to announce the launch of our second pilot this year with Mercy Corps Ventures as part of our Unlocking Opportunity initiative. In collaboration with WËIA, this pilot is designed to increase financial inclusion and income for smallholder farmers in Colombia through blockchain-powered traceability on the XRP Ledger (XRPL).
Addressing Critical Challenges in Agricultural Finance
The agricultural sector in Colombia faces significant challenges, with over 86% of smallholder farmers operating informally without credit histories or transaction records. This lack of financial documentation creates substantial barriers to sustainability and financial inclusion. Currently, 79% of the rural population lacks access to credit lines, resulting in smallholder farmers earning only 70% of the minimum living wage and perpetuating cycles of poverty.
Buyers of agricultural products struggle to verify sustainability claims, an increasingly important consideration for end consumers. Industry data suggests that up to 10% of the global food system is affected by food fraud accounting for approximately $50 billion annually.
Leveraging XRPL for Agricultural Transformation
The pilot program integrates WËIA’s blockchain traceability platform which was built on the XRP Ledger with innovative financial mechanisms to address these challenges:
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Blockchain Traceability on XRPL: The solution traces agricultural products from planting to harvesting, providing verifiable sustainability data via QR codes. The implementation on XRPL ensures immutable record-keeping with the speed, cost-efficiency, and carbon-neutrality advantages of the XRP Ledger.
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Market Linkage: By connecting farmers directly with input suppliers and produce buyers through the XRPL-powered platform, the project stabilizes income and fosters stronger relationships across the supply chain.
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Farm Now, Pay Later (FNPL): WEIA has already used the traceability data gathered through this pilot program to offer a FNPL option, allowing farmers to gain immediate access to agricultural inputs without upfront costs. This enables them to purchase the necessary supplies when planting crops and defer payment until after harvest.
Pilot Scope and Participants
Approximately 300 smallholder farmers will participate in the pilot, processing 240 tonnes of panela (unrefined whole cane sugar) monthly. Notably, around 46% of participating farmers are women, compared to the national average of 26%, highlighting the project’s commitment to gender inclusivity.
Measurable Objectives
The pilot aims to test three key hypotheses about the impact of XRPL-powered traceability:
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Enhanced Product Value: measuring the percentage increase in product price attributed to verified sustainability claims on the XRPL
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Improved Customer Satisfaction: assessing retailer satisfaction resulting from increased transparency enabled by immutable XRPL records
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Strengthened Business Relationships: tracking the number of farmers entering formal agreements such as forward contracts with corporate buyers by the end of the pilot
Expected Outcomes
This pilot offers a unique opportunity to demonstrate real-world applications of blockchain to improve traceability in agriculture, creating pathways for smallholder farmers to access financial services, improve livelihoods and ensure compliance with global sustainability regulations.
This program has the potential to establish a model for agricultural communities worldwide, bolstering financial inclusion and creating sustainable economic opportunity through transformative blockchain technology.
Learn more about Ripple Impact initiatives.
