Unlocking better agricultural finance: how microfinance banks can benefit from satellite and climate data
At Arbolitics, we believe that smarter data drives smarter lending — especially in agriculture. For microfinance institutions (MFIs) serving smallholder farmers, incorporating satellite and climate data into credit risk models transforms how loans are approved, monitored, and managed.
Why this matters
Traditional agricultural lending faces high default risks and costly field visits. Farmers' yields can swing with weather, pests, and changing soil conditions — factors often invisible to bank officers. Outdated risk models limit lending or inflate interest rates to cover uncertainty.
Satellite and climate analytics change this by providing real-time, farm-specific insights at scale. Metrics like NDVI (Normalized Difference Vegetation Index) and SAVI (Soil-Adjusted Vegetation Index) help lenders remotely check crop health, forecast yields, detect anomalies, and verify land use — no physical visits needed.
Key benefits for microfinance banks
- Increase loan approvals, reduce defaults
Pilot data shows approval rates can rise by 30% and defaults drop below 8%, compared to current rates of 15–20% — thanks to objective, up-to-date crop monitoring.
- Lower operational costs
Replacing frequent field inspections with satellite monitoring cuts staff travel costs and shortens loan processing times.
- Better portfolio risk management
Continuous climate alerts and historical weather data help MFIs anticipate issues early, adapt repayment terms, and manage exposure proactively.
- Enable financial inclusion
More accurate scores mean more deserving smallholders can access affordable credit, grow productivity, and build reliable credit histories.
How Arbolitics makes it simple
Our platform integrates high-resolution satellite imagery, advanced crop analytics, and automated farm boundary mapping. MFIs can blend the Arbolitics Score with existing credit data for a clearer, data-driven risk profile — without disrupting current workflows.
Ready to future-proof your agricultural lending?
Partner with Arbolitics to pilot satellite-based risk scoring and see measurable results within months.
Contact us to learn more | Empowering microfinance with smarter data