By Brendan Robinson, Director, PKF Pretoria

As someone servicing South Africa’s agricultural sector, I’ve witnessed firsthand the persistent and often frustrating struggle that farmers face – specifically when trying to access financial capital. Despite agriculture being such a vital part of our economy, our farmers, especially the emerging and small-scale ones, often find themselves caught in a web of challenges that make securing funding feel almost impossible.

Historically, the landscape has shifted dramatically. During apartheid, commercial farmers had relatively easier access to credit and government support, but since deregulation in the mid-1990s, much of that backing has disappeared. Consequently, many farmers, particularly those coming through land reform programmes, are without the collateral or financial history that our banks require to approve loans. Add to that the restrictions on land tenure for several emerging farmers, and you can see why accessing commercial finance can seem like an unattainable goal.

For smallholder farmers – which make up a huge part of our agricultural fabric – the challenges are even more pronounced. They often lack the necessary collateral, financial literacy, and market access, leaving them reliant on high-interest credit or informal loans. This traps them in a cycle that stifles growth and sustainability in their operations.

The reality today is that lending to agriculture involves a complex range of risks – seasonal income fluctuations, inconsistent financial record-keeping, escalating climate-related challenges, loadshedding, and the uncertainties of farm ownership transitions. These factors make banks cautious, often resulting in limited or expensive financing options.

What gives me hope is the growing recognition that the way forward is through collaboration between the public and private sector hold promise in bridging financial gaps. But the scale of funding available still falls short of meeting the real needs on the ground, especially when about 90% of smallholder farmers remain underfunded.

If we truly want to unlock the potential of our agriculture sector, we need to rethink the way we approach financing. It’s about innovation, using alternative collateral models, harnessing data and technology for smarter risk management, and supporting farmers beyond just loans, including market access and technical skills development.

This is not just an economic issue; it’s about securing food security, creating sustainable livelihoods, and strengthening rural communities. I believe, with the right strategies and genuine partnerships, we can transform South African agriculture into an inclusive, resilient, and budding sector.