Agritech startup Arya secures $30 million in debt financing

Agritech and lending platform Arya.ag on Thursday announced that it has secured a $30 million (Rs 259 crores) debt facility from HSBC India. The amount is guaranteed by GuarantCo, part of the Private Infrastructure Development Group (PIDG)-- which is funded by governments of the United Kingdom, the Netherlands, Switzerland, Australia and Sweden to name a few, the company said.

The agritech startup said it will use the capital to provide post-harvest liquidity to farmers, farmer producing organisations (FPOs) and small agri-enterprises, to bring them under the formal banking channel. “GuarantCo will offer partial guarantee to HSBC India for an Rs 259 crore loan to Arya.ag for providing liquidity to the agricultural sector,” Arya.ag said in a statement. GuarantCo will provide partial credit guarantees for two separate loan facilities to Arya.ag’s commerce platform Aryatech, and its fintech arm Aryadhan.

The startup’s cofounder Prasanna Rao during the announcement said through the funds Arya.ag will be paying sellers on behalf of the buyers to reduce distressed sales and secure better returns for their produce. “This allows farmers, FPOs and agri-enterprises to avoid distress sales immediately post-harvest when prices are at their lowest, by storing commodities until off-season when prices appreciate to often generate 20-30 percent higher returns,” he said.

The founder added that the funds will also be allocated to warehouse receipt financing and bridging payment gaps between farmers and buyers. “Arya.ag is one of the only profitable agritech startups to do so and has been making 2x profits annually,” the cofounder said and projected another 2x increase in revenue for FY 24-25 of Rs 38 crore. The firm is considering an IPO in 2027.

Apart from providing storage for non-perishables, the startup is also experimenting with perishables such as jaggery and building infrastructure. So far around 30% of its clientele is based in Bihar, Rao said.

HSBC India’s MD for Inclusive Banking Unit, Sonali Shahpurwala said, “We are pleased to collaborate with GuarantCo and Arya on this significant transaction that supports the agriculture sector, a primary driver for India’s economy,” adding that the loan underscores HSBC’s commitment to provide financial solutions that empower businesses like Arya to enhance infrastructure.