Absa Bank Kenya PLC is exploring ways to enhance its lending capacity under an existing Ksh.500 million facility to facilitate the purchase of tractors for Kenyan farmers on a Pay-As-You-Use basis.
This follows an agreement with agri-tech company Hello Tractor and the renowned U.S. agricultural machinery manufacturer John Deere which was signed two years ago.
In the initial phase, Hello Tractor successfully utilized the entire Ksh.500 million to acquire 100 John Deere tractors and other essential inputs. Now, they are launching an extension to increase lending capabilities, aiming to reach and support more farmers.
“The steep cost of acquiring tractors has long posed a challenge for Kenyan farmers looking to mechanize their operations. Our partnership with John Deere, a globally recognized leader in agricultural machinery, is instrumental in reducing these barriers, positively impacting farmers’ livelihoods and their communities.
By promoting mechanized farming, we are driving down costs and boosting food production efficiencies,” said Elizabeth Wasunna-Ochwa, Business Banking Director at Absa during the inauguration of Hello Tractor’s new Hub in Kisumu County.
This financing arrangement enables Hello Tractor to expand its tractor-hailing service across Kenya’s key agricultural regions.
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Farmers can hire tractors through Hello Tractor’s innovative app, which connects them directly with tractor owners, suppliers, and manufacturers.
The deal is projected to create 3,000 new direct jobs and enable the mechanization of over 300,000 farmers nationwide.
It is also expected to empower farmers to yield nearly 1 million metric tons of food valued at over Ksh.21.4 billion (approximately $150 million).
“Kisumu is our first hub, currently operating 50 tractors that serve 150,000 acres of land. Thanks to our partnership with Absa, we are equipping farmers with essential resources, expert advice, and training on best agricultural practices, contributing to growth not just in Kenya but across other African nations as well,” said Hello Tractor CEO Jehiel Oliver.
Representing the Kisumu County Government, Kenneth Onyango, CEC for the Ministry of Agriculture, commended both Hello Tractor and Absa for their initiatives that support farmers in transitioning from subsistence to commercial farming.
“I praise the efforts of Hello Tractor and Absa in helping farmers make this critical shift, which aligns with the County’s focus on enhancing food security,” he said.
Agriculture plays a key role in Kenya’s economy, contributing approximately 50% of the country’s Gross Domestic Product, 60% of export revenues, and employing 40% of the workforce.
By adopting a value chain approach, the bank actively provides tailored solutions for input suppliers, primary producers, aggregators, and agro-industry participants.
The financing agreement also promotes greater participation of women in farming mechanization, aligning with Absa’s broader strategic goals.
