Integrating the

Agriculture Value Chain

to Create a Double
Bottomline Impact

STRICTLY PRIVATE &

 LEADING THE MARKET

Market leadership with a 32% share in Largest on-ground Field Force

Country-wide outreach with 650+ Rural
farmer financing amongst Commercial
lending branches (600+)
Banks

Convenient account access via

Branchless agents and Mobile Banking Field teams equipped with hand held devices HBL became the first bank to finance
EWR in Pakistan

Slide 2
 DIVERSIFIED PRODUCT SUITE

Farm Production Poultry Financing Dairy & Livestock Financing Tractor Financing Fisheries Financing Farm Irrigation Solutions
(Running Finance for (Working Capital and (Working Capital and Asset (Conventional and Islamic) (Working Capital and (Purchase and Installation
Crop Input) Asset Purchase) Purchase) Asset Purchase) of Irrigation equipment)

Slide 3
 Kissan Ki Aawaz

• Progressive farmers engaged in various parts of the

rural value chain

Audience

• Imparting knowledge and understanding to farmers

about financial concepts, banking/financial products
and services
• Organized structured programs of
town halls where farmers are informed Financial
about agricultural finance products
450+ Literacy
450+
• Value added discussions on agronomy
and better farm management • Virtual and on-site sessions held with farmers and
techniques 48 industry stakeholders which included:
• Jaffer Agro Services
Scope • Enhanced financial literacy amongst • Naymat Collateral
the prospective farming community in • NRSP
underserved rural regions Sessions • National Foods
• Farm Irrigation Solution Providers
 DAIRY & LIVESTOCK

o Non-Crop contributes 61% of Agriculture GDP

o More than 10 million farm households involved in Dairy

o Dairy financing product launched in January 2021, targeting

farmers with a herd size > 50 animals

o Financed 800+ Dairy & Livestock Farmers to date, disbursing

PKR 1.2 billion

o These Dairy farmers have improved their herd management

and husbandry practices resulting in enhanced milk yields

o Financing product for working capital & animal purchase:

 Working capital for feed, medicines, inoculation, etc.

 Term loans for purchase of local, exotic and hybrid breeds

Slide 5
 Electronic Warehouse Receipt Financing
 An EWR is a document issued to farmers, traders, and processors, etc. against storage of their agriculture
commodities in accredited warehouses
 Real time access to banks with information on Agricultural commodities and creation of an online lien,
reducing transaction and operational risk
 The ecosystem provides ease in access to finance, reduce wastage, improve quality and gives market-
based price discovery
 HBL has invested in Naymat Collateral Management Ltd for the development of an Electronic Warehouse
Receipt (EWR) ecosystem
 Disbursed PKR 67 Million under this financing

LEVERAGING LAND RECORD DIGITIZATION

 HBL is the 1st bank in industry to have integrated its system with Punjab Land Record Authority.
 Implemented in 200+ HBL branches across Punjab – the highest in the banking industry.
 HBL is the leading user in the industry, accounting for 85% of document and 74% of land record retrievals
 Recognized by SBP – on their invitation, HBL conducted various trainings for the banking industry
Slide 6
 Development Finance’s journey from an idea to reality

INCEPTION PHASE
2019 Program was conceived and relevant approvals along with the
value chain partnerships were established.

PROOF OF CONCEPT
2020
Program was piloted with 444 acres in Sahiwal and Gujranwala.

MID-SCALE INTERVENTIONS
2021 Program was scaled up to 10,497 crop acres in same regions,
with anticipated ~7,500 more acres for fall crops.

SLIDE # 7
 HBL employs at team of over 45 Agronomists & Field Officers

Problem Farmers
Identification
HBL Agronomists Day
getting consent
from farmers on
planned
interventions
Reviewing a HBL – Bulk Buyer –
Rice Nursery Farmer Engagement

Senior Agronomists
Soil Rice Field
Sampling Inspection

Most farmers are unbanked. They are being made aware of how they will receive payments from processors via
HBL branchless banking solutions KONNECT and HBLPay.
SLIDE # 8
 Using Technology to solve Customers’ Problems
HBL Pay facilitates end-to-end digital journey for farmers ‘at the farm’ by Agronomists, from digital
onboarding to crop plan generation for loan approval in centralized LOS
Post-Simplification Impact
Konnect Account
Handoffs Opening

Document
-7 -7 Procurement
26 19 12

Farmer Visits

Filling of
Application

-6 -
8 2 2
Turnaround Time Biometric
Verification

Application
-8 -3 Submission
18 days 10 days 7 days
STRICTLY PRIVATE & SLIDE # 10
 Moving towards Mid-scaled Interventions in 2021
After a successful proof of concept in 2020, HBL’s engagement with farmers has increased multifold

35 farmers
given unsecured
financing in
2021

10 x 52 x 40 x
Farmers Portfolio Volume Number of Crop Acres

2020 15 farmers 2020 PKR 15 million 2020 444 crop acres

Current Impact 2021 150 farmers 2021 PKR 469 million 2021 10,497 crop acres

Tentative Closing 2021 190 farmers 2021 PKR 850 million 2021 17,000 Crop acres

SLIDE # 10
 Per Acre Impact of 2021 Midscale Interventions
For Spring Maize 2021, HBL launched a midscale intervention in Okara

Farmers = 78
Acres = 3,218
Amount = Rs
151 Mn Traditional Revalidated by
HBL Model % Change
Model Princeton/ CERP

Average Yield [Maund] 87 106 22% 22%

Gross Revenue [PKR] 113,760 138,907 22%

Total Cost [PKR] 67,930 39,856 -41%

Net Income 45,830 99,052 116% 117%

For Spring Maize 2021, HBL focused on small farmers.
• Average landholding of the participating farmers was 3 acres per farmer, with average land cultivation of 36 acres per farmer
HBL disbursed its FIRST unsecured financing to spearhead financial inclusion
• 26% of participating farmers received unsecured lending. Traditionally, farmers who do not cultivate on owned lands are excluded from the formal
financial sector due to lack of collateral.

SLIDE # 11
 Rice Intervention: Cataloging and Monitoring at Actual Locations
1 2 3

Mechanical sowing of Rice nursery Trays for transplanting Transporting of Trays

4 5 6

Trays loading on the transplanter Mechanized transplanting Transplanted field SLIDE # 12

 New Partnerships to widen the Agriculture Services Ecosystem

Maize Rice Potato Wheat

Crop Inputs Suppliers

Mechanization Services Providers

Bulk Buyers

SLIDE # 13