Founded in 2017, EthicHub is the first Regenerative Finance (ReFi) solution integrating finance, crowd collateral and trading for a regenerative supply chain where farmers are no longer the weakest link. Agriculture is key to Climate Change and EthicHub is committed to revolutionize the way agriculture in emerging economies is financed.
According to the World Bank, a quarter of the world's population is excluded from the traditional financial system. Their only source of working capital is the small cash loans they can borrow within their own communities, often paying over 100% annual interest for insufficient money. 70% of these Unbanked are smallholder farmers living in poverty despite producing one third of the world's food. This exclusion is particularly concentrated in long-term agricultural finance, for which 98% of global demand remains unmet (almost $1Trillion dollars).
Agriculture supply chain remains pre internet (starting with coffee, one of the most traded commodities): heavily intermediated, opaque, inefficient, capital intensive, with small farmers being the weakest link despite producing 80% of the world’s coffee (2023 FAO report).
The social, economical and environmental consequences of this exclusion are dramatic: migration, poverty, deforestation to name a few).
A crowd-lending platform backed by crowd-collateral (Blended Finance on smart contracts) enables access to affordable finance to unbanked farmers, connecting DeFi to the productive economy of the real world.
EthicHub’s crowd lending platform enables anyone to become impact investor by lending capital to groups of farmers and earning a fix interest rate in return. Additionally EthicHub provides farmers with access to added-value markets without intermediaries so they are no longer the weakest link in the supply chain.
At the same time, our web3 investor community stakes Ethix (EthicHub’s utility token) as collateral on behalf of the farmers to back their loans. This is an integrated unique solution where third parties secure the loans instead of using data or assets for risk evaluation.
By leveraging the power of blockchain technology and smart contracts, disintermediation allows better rates for lenders and farmers, boosting productivity, trading and traceability with social, economical and environmental impact.
Coffee trading allowed us to improve unit economics and create an entry barrier as we offer an integrated solution to farmers that nor financing competitors, nor trading competitors can overtake.