In order to co-fund a project development and implementation of the yield guarantee solution for smallholder farmers in India, InsuResilience Solutions Fund (ISF), managed by the Frankfurt School of Finance & Management (FS), and financed by KfW Development Bank, signed a grant agreement with Weather Risk Management Services (WRMS), an agriculture risk management company, and Ingen Technologies, a data provider of weather stations. The project aims to improve the resilience of 100,000 smallholder farmers in India against climate risks and incentivise smart agricultural risk management practices, as well as to scale up the yield guarantee solution for crops such as cotton, chilli, paddy, and wheat and potato.
Weather Risk Management Services (WRMS) offers SecuFarm – the smart and sustainable farming solution for smallholders to provide them with a farm-level yield guarantee and an assured income. The solution guarantees farmers a benchmark yield provided they follow the Package of Practice (PoP) shared with them on the SecuFarm app. If the actual yield is still below the benchmark yield due to any extreme weather attack or crop disease, the farmer is compensated by WRMS, in proportion to the shortfall. This innovative concept allows the incorporation of the necessary farm-level risk reduction measures in the insurance product design offered by insurance companies and incentivises smart and sustainable farming practices. This in turn allows offering a premium discount or a higher guaranteed yield to farmers who take the necessary farm-level risk management measures. Fees for the yield guarantee are paid by the farmers (without subsidies).
Highlighting the agreement, Anuj Kumbhat, Founder & CEO, WRMS said, “At WRMS, our aim is to build the resilience of smallholder farmers by giving them equal opportunities to thrive. With this new association with InsuResilience Solutions Fund, we are now ready to further ramp up our SecuFarm services to the next level and support the smallholders to our maximum extent. With the support of ISF, our focus will be on reaching out to over 100,000 smallholder farmers and building digital SecuFarms to create a larger economic, social and environmental impact.”
WRMS has offered SecuFarm to more than 25,000 farmers in 22 states of India to date. While in certain states farmers are contracted directly by WRMS, in some states the company connects with farmers by partnering with farmer producer companies, agriculture input companies and local banks.
India ranks among the top five countries vulnerable to natural hazards with high exposure to extreme weather events like floods, earthquakes, cyclones and droughts. In addition, climate models indicate an all-around increase in temperature and rainfall variability across the country. This puts a lot of pressure on the agriculture sector of India, especially on smallholders who make up 78 per cent of the country’s farmers. Thus, it is crucial to build the resilience of smallholder farmers to climate change and the risk involved in farming by encouraging them to adopt advanced climate-smart agriculture innovations.
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