Agri firms reap fruits of crowdfunding

A CreditEase Corp's financial planner prepares promotional materials for her customers. [Photo by An Xin/For China Daily]

Crowdfunding has helped boost the business of agricultural companies in the southern island province of Hainan, thanks to a financing firm's cooperation with local authorities.

CreditEase Corp, a leading Chinese peer-to-peer or P2P lending and wealth management company, has worked closely with the Hainan Equity Exchange Center, to provide crowdfunding services to local agricultural companies since last year.

As of September, six crowdfunding projects have been launched. High-worth transactions were clinched online, said Ban Miaoqi, general manager of the HEEC.

"We have seen a growing number of local agri-companies use crowdfunding to boost sales of their products," said Ban.

According to him, more than a dozen such projects are on the drawing board. At least five are likely to be launched in the last quarter of this year.

Agri-products of the tropical Hainan are usually low-priced and promoted in a low-key way nationwide, according to Ban.

"Now, using big data and access to a large number of high networth individuals on CreditEase's various online financing platforms, Hainan's agri-products will be better promoted," said Ban.

Currently, crowdfunding schemes related to agri-product projects are on Zhiwang Wealth Mangement, a comprehensive online financing platform of CreditEase.

Li Xiaogang, chairman of the HEEC, said crowdfunding has helped boost the presence of Hainan's agri produce in the domestic market.

"CreditEase's online financing platform serves more than 120,000 HNIs. They are potential buyers who value organic produce and are willing to pay more for such high-quality products," said Li.

For instance, crowdfunding has made available honey pomelos of a local company in Chengmai county of Haikou, capital of Hainan, to a larger market outside the island. This, in turn, has fetched higher prices.

Now, Hainan's honey pomelo is sold online at more than 100 yuan ($14.8). The company concerned netted 62,112 yuan within a week in sales financed by crowdfunding.

Xing Jun, general manager of Sanya Nanlu Industry Co, a leading organic wax apple company founded in 2009, said internet-based financing services, especially crowdfounding, have helped promote Hainan's agri-products.

"In the past, agri-products of Hainan were sold at lower prices due to lack of branding and promotion," said Xing.

"We are trying out a new way of selling our products. We didn't realize that financing companies could help us sell wax apples," said Xing.

The company's annual sales reached more than 10 million yuan last year. "We'll launch more such internet-based funding projects in future to better promote our products," he said.