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MakerDAO will be exhibiting at the [3rd Asia Finance Forum: The Future of Inclusive Finance](https://challenges.adb.org/en/challenges/agri-fin?lang=en) on the 6th and 7th November, taking place at the ADB's HQ in Manila. As MakerDAO enables an open financial ecosystem, we would like to put a challenge to the community to build some solutions for the obstacles faced by ADB, when targeting the agricultural sector.
**Important: Please note this challenge is not a collaboration and ADB is in no way affiliated with MakerDAO. The giveaway is not in any way endorsed by ADB. It is purely an independent Maker initiative to incentivise the community to brainstorm solution for real life challenges using Maker protocol, while also standing to gain some extra DAIs.**
## Details of the Challenge
### Calling for Fintech Solutions to Support the Agricultural Sector
Asian Development Bank (ADB) is looking for great ideas in solving the problems of smallholder farmers. To kick off your creative juices, they are giving you an idea below on how this could potentially be tackled.
Still, ideas for AgriFin Challenge are endless! So feel free to submit other solutions that go beyond this concept.
Example: Digital platform that will provide access to a range of non-financial services (marketplace, value added services, information, access to quality input prices, etc.) throughout the agricultural value chain, connecting financial services (credit, payments, savings, insurance) where it makes sense.
#### For your deliverable, ADB expect:
- **_A video demo of your prototype that is a combination of two to three services._**
- **_A presentation deck including a product roadmap._**
## Problem Statement
The agriculture sector in Asia is composed primarily of smallholders, with agricultural holdings averaging less than 5 hectares for the region. Smallholder farmers play a significant role in achieving food security, contributing up to 80% of the food supply. Yet small scale farmers remain among the poorest, most marginalized, and most vulnerable sectors.
Increasing the productivity of smallholders will help them move out of poverty. However, they face several constraints. Among them:
- High quality seeds, fertilizers, feeds, equipment, and other inputs are subject to high transaction costs, asymmetric information of prices, and market monopoly.
- Limited channels to the marketplace lead to low bargaining power and post-harvest/processing losses.
- Post-harvest, farmers are exposed to price risks caused by limited crop shelf life. Farmers have a short window to distribute their harvest which leads to paper thin margins.
- In the livestock (dairy) industry, as the cost of collection and transportation of milk is high, because of the scattered nature of the production system, farm gate price of milk is low.
- Knowledge and skills to improve productivity and value are lacking. In addition, access to information, such as prices and weather conditions, needs to be improved to aid in decision making.
- Lending to the agriculture sector is perceived to be high risk. Financial institutions offer credit products that have high interest rates and repayment periods that are not compatible with agricultural cycles. Access to other financial services such as savings and insurance is also limited due to remote farm areas and lack of financial literacy among smallholders.
- Many smallholder farmers are financially excluded
- Women farmers tend to have less access than men to productive assets, opportunities, and technology. The female share of agriculture labor in farms is 40%–50% and is increasing due to migration of men to urban areas and overseas for employment.
### Ideas for Solutions:
The solution **must take into consideration the context of most rural communities in Asia**—poor internet connectivity, use of regular feature phones, and operations in remote, hard to reach areas. The solution may have an online and offline component. It should also be flexible enough to cater to the different agriculture subsectors (crops, livestock, poultry).
Below is an example of a use case we are looking to solve:
- The livestock value chain in Tajikistan is unproductive, and extremely inefficient. In particular, the dairy value chain has several disperse actors (dairy processors, farmers, breeding, concentrate, and fodder enterprises, financial institutions, public support institutions) that need to be integrated.
- Over 90% of the cattle are owned and over 90% of the total milk is produced by household farmers. Household cattle have low productivity due to chronic under-feeding and poor animal and husbandry practices, low reproductive efficiency, and weak market access for their products. The Tajik livestock sector also has high incidence of several animal diseases. Quality assurance and food traceability are major concerns. Furthermore, growth and competitiveness of the dairy processing industry is constrained by limited availability of fresh milk, dispersed collection, and state of infrastructure.
## About Asian Development Bank
The Asian Development Bank envisions a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty in the region. Despite the region's many successes, it remains home to a large share of the world's poor: 330 million living on less than $1.90 a day and 1.24 billion on less than $3.20 a day.
ADB in partnership with member governments, independent specialists and other financial institutions is focused on delivering projects in developing member countries that create economic and development impact.
As a multilateral development finance institution, ADB provides:
- technical assistance
Our clients are our member governments, who are also our shareholders. In addition, we provide direct assistance to private enterprises of developing member countries through equity investments and loans.
## What's in it for you?
1. To gain visibility in the global financial stage
2. A chance to pilot your solution with ADB's support
3. To bring decentralisation to the real world.
## Challenge Milestones and Awards
Start a team or join an existing team [here](https://challenges.adb.org/en/challenges/agri-fin/teams).
MakerDAO will give away DAIs if you integrate DAI or Maker protocol in your solution:
**Challenge 1:** MakerDAO will give away 300 DAI/team if you submit an application and deliver the two deliverables set by ADB.
**Challenge 2:** If your team is shortlisted to pitch at the final pitching day at the ADB's HQ in Manila on the 5th Nov. Maker will give away 3000 DAI on top of the prize money give away by ADB.
For more details of the challenge, please refer to: [Call for Fintech Solutions to Support the Agriculture Sector](https://challenges.adb.org/en/challenges/agri-fin?lang=en)