Arya.ag, India’s foremost and singularly successful grain commerce platform, has introduced blockchain-based agricultural loans. Through its financial technology subsidiary, Aryadhan, warehouse receipt loans will now be executed on their blockchain, ensuring users the utmost confidence and transparency in the process.
Arya.ag has digitized the commodities stored within its warehouses, allowing the platform to now facilitate disbursements on the blockchain.
“Trust and transparency are key values for us at Arya.ag. Porting all disbursements on the blockchain while making payments in under five minutes will mark a significant leap in the efficiency of agri-lending services. The blockchain will ensure unprecedented visibility and assurance to control all physical risks in commodity storage and finance,” said Prasanna Rao, CEO of Arya.ag.
In collaboration with 35 financial institutions, encompassing banks and NBFCs, Arya.ag has established itself as a significant player, overseeing 7.6 million tonnes of commodities and boasting an AUM of 3 billion USD in the previous fiscal year.
“We look at collaborating with other lenders to move commodity-based warehouse-receipt financing onto the blockchain and improve the overall transparency, speed, and reliability of these transactions,” said Rao.
Within the realm of agricultural lending, a central challenge is to instill trust between lenders and borrowers. Arya.ag addresses this issue by leveraging blockchain technology. Arya.ag serves as the reliable custodian for every generated token, preventing duplication of pledges and ownership disputes. When a pledge is made, a smart contract is activated, enabling banks to assign a unique identifier to the token lien. This process ensures the uniqueness of each pledge while affording banks a consolidated overview of all pledged commodities.
Transitioning the lending process to a blockchain offers the dual benefits of accelerating transactions and substantially elevating security and trust among all involved parties. The decentralized characteristics of blockchain guarantee unchangeable record-keeping, rendering data both transparent and exceptionally secure, virtually immune to tampering. This, in turn, results in a notable reduction in fraud and errors. Furthermore, such a transition would establish standardized procedures and documentation, thereby streamlining interactions among diverse stakeholders in the commodity trading and financing sectors.
Arya.ag joined forces with Newrl, a decentralized trust network blockchain, to create this infrastructure. As of now, Arya.ag’s ledger hosts 3.2 million metric tons of commodities spread across 894 warehouses within the blockchain network. Through this endeavor, Arya.ag is forging a realm of swifter and more secure transactions, benefiting not only large enterprises but also, significantly, smallholder farmers. This technology levels the economic landscape, granting them expedited and fortified access to the financial resources necessary for their prosperity.
