Fintech for Data Collection in Risk Management for Ag Finance

Fintech is filling a kingpin role in the financial sector lately, as financial institutions work to streamline their risk management and decision-making processes. In agriculture, in particular, fintech offers a wide range of benefits for Farm Credits and lenders.

But when it comes to ag finance, there’s a gap between what fintech tools are capable of and the information they have to work with. Too often, risk data is siloed, making it harder for ag professionals to use the latest tools to make financial decisions.

With better data agility in risk management, ag finance professionals can benefit from fintech tools and bring their risk mitigation strategies into the 21st century.

The Problem With Siloed Risk Data

For financial institutions of all kinds, but especially in agriculture, risk data is often siloed and difficult, expensive, and time-consuming to access. Moreover without the data acclimation fintech solutions, joining portfolio data with risk data in a holistic, integrated, geospatial format would yield incomplete results. Farm Credits and ag banks are all too often aware of these limitations but lack the tools they need to address them.

For example, among the complex web of risks that modern financial institutions deal with, climate risk is a particularly daunting one. It has been clear that disparate data sets can only take the utility of the data so far.

Ag professionals can use standalone climate analytics data, but unless they have a way to integrate this data with their existing bank data, it isn’t holistically complete. Acclimated proprietary data speeds up loan and asset valuation processes and aids the decision-making process. Data acclimation is an invaluable type of fintech that integrates first-party data with third-party data through secure APIs.

The fact is that datasets needed for due diligence, risk management, asset and land valuation, appraisals, and more are disparate and siloed. Fintech has evolved to solve this problem, centralize all the right datasets, and securely integrate them into first-party portfolio datasets.

It gives ag finance professionals such as Farm Credits and lenders the ability to see their portfolio through the lens of any risks on a map and through risk scores.

How Fintech Can Un-silo Risk Data

When boiled down, a core goal of a financial institution is to mitigate risk. Effectively mitigating risk requires un-siloed risk data.

Fintech that un-silos data from many disparate sources and pulls it together into an interactive map is the powerful ally that ag finance businesses such as Farm Credits and lenders need to streamline their data and risk management. GIS Connect represents this.

This can include everything from proprietary data – such as loan and borrower data – as well as third-party risk data (i.e., appraisal reports) and other water and climate risk data.

Only by acclimating financial data can ag lenders and investors make decisions that take the whole picture into account. By improving the way they handle data collection in risk management, ag professionals can uncover new links between datasets, and use those insights to mitigate overall portfolio risk.

Not only that, but fintech can improve communication with borrowers, making it easier for borrowers and lenders to uncover risks and apply the most effective risk management strategies. Regarding fintech, Forbes argues that “novel methods to ensure against climate-related risk can allow small-scale farmers to survive weather disasters and spare the sector the economic scarring that plagues the post-pandemic restaurant industry.”

Using GIS Connect for Data Collection in Risk Management

Fintech has become an important part of today’s financial sector particularly in ag finance institutions such as Farm Credits, lenders, and banks. Data collection is a key issue, and the right fintech solution can open up a whole new world of un-siloed data, giving lenders and investors a competitive edge and reducing exposure to risk.

With GIS Connect, ag professionals can solve the problem of data collection in risk management by understanding a portfolio geospatially. Users can gain new insights by using map data visualization and other interactive tools. By zooming in and out of borrower parcels and farming regions, adding and removing layers of data, and generating risk scores and PDF reports, ag finance professionals can get a more holistic view of their investments and share those insights with other stakeholders.

GIS Connect is specifically built for ag finance professionals, by working with customers to understand exactly what they need. Through building strong relationships with customers, AQUAOSO has developed a purpose-built tool for risk and data management in Farm Credits and ag lenders.

In order to truly understand risk in today’s work, ag professionals must have access to fintech tools that are specifically adapted to their needs. By utilizing data acclimation to collect relevant risk data and accessing it in an un-siloed format empowers ag finance institutions to stay nimble and competitive in a changing financial landscape.

Using fintech for data collection in risk management makes it possible to work alongside borrowers to reduce risk and create a more sustainable agricultural industry.

The Bottom Line

Fintech has a wide range of applications in the ag finance industry, from automated loan decisioning tools to crop insurance underwriting. It’s especially important in the area of data collection in risk management because it can allow ag professionals to integrate disparate datasets and view them all in an intuitive, map-based format.

GIS Connect is a fintech solution especially for financial institutions in the agricultural sector, helping lenders, investors, and farm credits collect and manage their data. By acclimating existing bank data with third-party datasets, users can save time and bring their decision-making process into the 21st century.

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