Traditional bank Santander teams up with Agrotoken to provide loans backed by cryptocurrencies
In a pioneering move, Agrotoken and Santander Argentina have joined forces to create a revolutionary credit system for farmers. This collaboration leverages blockchain technology and cryptoassets to tokenize agricultural commodities, such as grains, and use them as collateral for loans or credit lines.
The innovative product, developed by Agrotoken, ensures that these tokens representing agricultural goods are easily verifiable, secure, and tradable. This reduces dependence on traditional credit systems, which often require lengthy processes and lack transparency. Santander’s involvement brings traditional banking capabilities and financial market access, bridging conventional finance with innovative blockchain solutions to better serve the agriculture sector.
Farmers can now turn their physical products into digital assets, facilitating liquidity and providing faster access to credit backed by tangible assets. A pilot test has already been conducted with Argentine farmers to validate the technical and operational workings of the product.
According to Fernando Bautista, head of Agribusiness at Santander Argentina, this is the first time a financial services platform has used blockchain and cryptoassets technology to expand the agricultural credit market and unlock the farmer's business potential. Eduardo Novillo Astrada, CEO and co-founder of Agrotoken, further emphasised this as the first global experience in backing loans with tokens based on agrocommodities.
Santander Argentina, with over 8,000 employees and a presence in 22 provinces and the city of Buenos Aires, is investing USD 225 million in technology to support this digital solution. The aim is to provide farmers and the agroecosystem with a new financing system that expands credit capacity using tokenized assets.
The global financial services platform connects tokens based on agricultural products to financial products, and the agrotokens can be used for various transactions, with prices reflecting real-time grain values. On March 7, 2022, Agrotoken and Santander are developing a global tokenization infrastructure for agrocommodities such as soya beans, corn, and wheat.
This partnership marks a significant step towards democratizing access to credit for farmers, fostering financial inclusion, and unlocking the potential of the agricultural sector through innovative technology.
In this partnership, the digital solution developed by Agrotoken and Santander Argentina utilizes technology to tokenize agricultural commodities, bridging traditional finance with innovative blockchain solutions in the agriculture sector. This groundbreaking collaboration allows farmers to turn their physical products into digital assets, enabling faster access to credit backed by tangible assets, thereby expanding the agricultural credit market and democratizing access to finance in the industry.
