Image credit : Ministry of Village, Development of Disadvantaged Regions, and Transmigration

JAKARTA (TheInsiderStories) – Sharing economy business model is gaining momentum in Indonesia. After making in-roads in the transportation sector, in particular, the ride-sharing applications, the sharing economy scheme is now making headways in the agriculture sector.

Indonesia is an agrarian nation given that majority of its population are working in the agricultural sector. Based on the Statistics Indonesia data, as of February 2018, the total population working in the agricultural sector reached 39.68 million people, larger than other sectors.

However, the sector is still facing numerous problems. Among problems being encountered are the disparity of commodity prices at the farmers level and the end consumers. Often, farmers received only thin margin for products they produce, while large margins are enjoyed by traders or middlemen.

The other issues encountered by farmers are lack of information. As a result, the farmers could not manage well their production level to adjust to the current market price or anticipate price trend. The other major problem is lack of financial access, which limits their capability to expand their production.

Given the above problems, a number of startup companies and entrepreneurs have tried to utilize technology to produce better agri products, create platforms to provide capital to farmers through crowdsourcing platform as well as slashing the lengthy distribution chain by creating e-commerce platform, that enables farmers or suppliers send or deliver products directly to customers.

These applications are basically an implementation of shared economic models. There are various definitions of sharing economy. However, sharing economy, shared economy or collaborative consumption, is basically an economic system in which assets or services are shared between private individuals, either free or for a fee, typically by platform.

In the past few years, a number of mobile applications have been launched in the country aiming at addressing the above problems. These mobile applications serve various purposes.

Some of them are created to help connect the farmers and buyers directly and in other cases provide channels for investors to invest directly to farmers that are in need or vice versa, helping farmers to get direct access to investors or fund owners.

Some applications are created to provide real-time food and agriculture product prices, which help farmers gain access to information on a timely basis. Some applications are created to help farmers to apply smart farming, which improves the quality of the harvest or put.

In other countries, there have been also some mobile apps that allow unused farming equipment to be used by other farmers, hence increasing the utilization of the assets.

In India, for instance, a pioneering startup EM3 AgriServices, farms or farmers can rent equipment and machinery via a platform. The company has used sharing economy values to maximize resources.

These mobile applications have common goals improve efficiency from the farming process to the distribution of output to end consumers. In the long-run, these digital platforms will not only help the livelihood of the farmers but overall help the country’s economy.

RegoPantes, Limakilo, Sayurbox, and Etanee, are among digital platforms that have been created to help connect farmers who produce vegetables, fruit and meat and consumers.

The other applicaitons are Kecipir, RegoPantes, Limakilo, Sayurbox, TaniHub, Happy Fresh, Tumbas.in, Petani, LimaKilo, Pantau Harga, Sipindo and Crowde.

Etanee, launched last year, provides platforms and solutions for farmers and suppliers in selling their products to the buyers by cutting the logistic chain. Kecipir provides a platform for hundreds of organic food producers to sell their products and delivers the products to the consumers or buyers.

TaniHub does not only function as an agriculture product e-commerce but also it provides financing to the farmers from funders, such as from its own platform Tani Fund, peer-to-peer lending platform Modalku and others.

Similar this is Crowde, a crowd-investing platform that enables farmers to raise their working capital from a crowd-investor with a profit-sharing scheme. Crowde aims big to increase farmer’s welfare by empowering farmers to become ‘agropreneurs’, creating an efficient agriculture ecosystem.

True that the digitalization of agriculture sector and the trading of agricultural products in Indonesia is still in the initial stage. Nevertheless, early indications have shown that these digital platforms have helped farmers to widen their market access as well as simplify distribution network, therefore improve their profit margin.

The digitalization of agriculture sector in Indonesia is still in its initial phase. This digitalization will continue. Given its benefits, all stakeholders, including farmers, traders as well as policymakers, should embrace the digitalization of agricultural sector in Indonesia.

Email: roffien@theinsiderstories.com

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