Blockchain to help farmers access credit, create futures market

Blockchain technology may help Filipino farmers access much-needed financial credit to boost their capital and may even create the country’s commodity futures market, an Asian Institute of Management (AIM) professor said.

- By JASPER EMMANUEL ARCALAS

Daniel Broby, the academic program director of AIM’s Master of Science in Financial Technology, said employing blockchain in the agriculture sector, especially in crops like rice, could contribute to addressing farmers’ lack of access to financial credit.

Broby explained that the two persisting issues of farming in the country are small landholdings and lack of financial access.

He said farmers aggregating their produce through a cooperative setup so that they achieve economies of scale could solve the problem of small landholdings.

The establishment of a futures market, which the Securities and Exchange Commission has proposed since last year, would modernize rice trading in the country and even globally, Broby added.

The blockchain technology will serve as a complementary system to the futures market wherein the aggregated produce of farmers will be tokenized and put on the blockchain that will be traded as standardized units, the professor said.