A suite of blockchain-based and Internet of Things tools is to be used to promote trust among the participants in one of the world’s leading coffee-producing countries and provide greater accuracy throughout the supply chain.
GrainChain, a software platform that creates blockchain and internet-of-things (IoT) innovations for the agricultural industry, has signed agreements with stakeholders from every part of the coffee industry in Honduras to deliver an e-commerce platform that it claims will help minimize risk, improve conditions and encourage reinvestment.
GrainChain is working with groups along the coffee growing process, bringing the entire supply chain together on a single platform for the first time.
GrainChain said what it described as the “unprecedented” step in uniting parties along the coffee supply chain in Honduras accomplishes three primary goals that will help guide the future of the industry.
Firstly, the blockchain-driven platform will improve trust between farmers and banks, ultimately opening more services for people in remote areas who were previously unbanked. Second, a full suite of connected IoT tools will help improve accuracy throughout the entire process for all stakeholders. Thirdly, the commerce system should dramatically improve clarity throughout the process, protect the farmers and ensure that they receive quick and proper payment.
GrainChain’s platform includes a digital wallet, enabling remote and unbanked farmers to apply for loans to enhance their farms. Banks can then direct the use of money that is lent so that it can only be use for its intended purpose, which helps mitigate and control risk. GrainChain’s ‘unchangeable smart contracts’ will further improve traceability and operational logistics for vendors and buyers.
Growing coffee involves so many different actors and so many variables that it has been very difficult to ‘get people on the same page,’ said GrainChain, ‘which reduces trust across the entire supply chain.’
Francisco Fortin, general manager of Confianza SA-FGR, an insurance provider to the agricultural industry said that, with GrainChain’s blockchain platform, “we can ensure that all parties are able to participate in the product with much greater visibility and minimized risk through every step.”
Use the blockchain commerce system will have a number of additional benefits for stakeholders in the Honduras coffee industry. Banks will use GrainChain to manage thousands of loans to small- and medium-size farmers, including using the digital wallet for unbanked farms to enable loan disbursements, and insurance companies will use it to simplify and automate underwriting of farmer loans backed by banks and the federal government.
Co-ops and growers will benefit from GrainChain’s traceability tools, farmer management, logistics management and farmer loan programmes. Exporters and buyers will benefit from using its ‘smart contracts’ for settlement, traceability, purchasing commodities and instant transfer of title.
“Our platform provides guarantees and visibility through the entire process, which empowers growers and vendors while reducing risk to bankers and buyers,” said Luis Macias, CEO of GrainChain. “We believe that building agricultural industries with blockchain tools will encourage reinvestment and improve quality throughout by giving people a single platform they can trust.”
GrainChain’s products give farmers access to their commodities via mobile apps, enabling them to see inventory in real-time and giving them the ability to make decisions on the field.
Through its suite of blockchain-based and IoT products, GrainChain will improve efficiency, create transparency and reduce human error, the company claimed.
Important data such as quantity and quality are captured by GrainChain and applied to the appropriate inventory, which enables immediate contract settlement.