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Use of Satellite to review Farmer’s Credit

Use of Satellite

In a significant move to providing hassle-free loans to farmers, the ICICI bank has announced that it is using satellite images to assess the creditworthiness of its customers who belong to the farm sector.

The bank became the first bank in India to make use of satellite to measure an array of parameters and use it in combination with demographic and financial parameters to make lending decisions for farmers. 

The Significance of the use of satellite (innovative technology)

This use of innovative technology allows farmers with existing credit to enhance their eligibility, whereas farmers who are new to credit can now get better access to credit. Moreover, as the land verification is done in a contactless way using satellite data, credit assessments are being done in a few days time as opposed to the industry practice of up to 15 days.

The bank has been using the satellite data for the last few months in more than 500 villages in the state of Maharashtra, Madhya Pradesh, and Gujarat, and it plans to scale up this initiative to more than 63000 villages across the country. This unique innovation gains significance at a time when people are encouraged to stay at home and avoid travel due to the Covid-19 pandemic.

The use of satellite data gives a quick and technically sound analysis of the land, crop, and irrigation patterns from remote locations without requiring from the customer or a bank official to visit the land. Its significance can be gauged by the fact that it provides the advantage to the farmers of delivering reliable data to the bank without any sort of travel, operational or logistical expense to them.

Understanding how it will work (Statement by the Executive Director, ICICI Bank)

Anup Bagchi, Executive Director of the ICICI Bank, stated that the bank has a legacy of pioneering innovative technologies to create propositions that provide immense convenience to customers. He further said that they had created new paradigms in the financial services industry by taking the lead in bringing path-breaking innovations such as firsts like internet banking in 1998, mobile banking in 2008, Tab banking in 2012, 24*7 touch banking branches in 2012, software robotics in 2016, and blockchain deployment in 2016.

Speaking about the new initiative, he said that they are bringing in yet another futuristic technology of using satellite data and analysis that will help in credit assessments for lending to farmers. Before this, one required visiting remote locations to assess manually many parameters on the land location, irrigation levels, and crop quality patterns to forecast future revenue of the farmers.

With the use of this technology, imagery from earth observation satellite provides them the groundbreaking ability to track information across large areas in a contactless and reliable manner. With this and demographic and financial details, it gives them rich information on the land asset of the farmers. The Executive Director, ICICI bank, further stated that the usage of this technology should enhance accessibility to credit as new to credit farmers would have easy access to formal credit, and those farmers with existing credit lines would be able to expand their eligibility securely. The bank expressed its conviction on covering more than 63000 villages in the country for lending with the use of satellite data.

How did the bank work on using this unique technology to assess farm loans?

The bank has partnered with agri-fintech companies that specialize in harnessing space technology and weather information for commercial usage. It has closely worked with them to build reports with more than 40 parameters to assess the creditworthiness of a farmer with an in-depth study of the land, irrigation, and crop patterns. 

The analysis is put together by using algorithms that help in analyzing images provided by the satellite around the planet. Moreover, the bank also worked on further scoring models to create indices at the district level, village level, and individual land to provide with an estimate of the past and the future agricultural income, the timing of the harvest, and the sources of income, thereby providing key inputs to credit assessments.

What sort of advantages can be enjoyed by the use of satellite data?

 The following are the advantages of using satellite data:

Use of Satellite
  • The satellite data with demographic and financial details gives strong information on farmers’ land assets.
  • By using this technology, farmers with existing credit would be able to expand their eligibility, and it will help new to credit farmers to enjoy better access to formal credit.
  • This technology is also expected to cut the time of providing credit, and the credit assessments are made in a span of few days as opposed to the industrial practice.

What are some of the key satellite data used by the ICICI Bank?

 Some of the key satellite data used by the bank are as follows:

  • Rainfall and temperature data of past years;
  • Soil moisture levels in past years;
  • Availability of surface water;
  • Trends in crop sowing including the crop name, tentative sowing and harvesting weeks, crop health and yields;
  • Details of the agriculture land location including latitude, longitude, and the boundary of the land; and
  • Nearby locations of warehouses and mandis are also monitored through satellite imagery.


The use of satellite technology will assist farmers who are existing customers of the bank and non-customers to avail of Kisan Credit Card[1] loans. Kisan Credit Card attributed one-third to the bank’s rural loan portfolio of 571 billion rupees in the quarter ended 30th June 2020.
Ashish M. Shaji

Ashish M. Shaji has done his graduation in law (BA. LLB) from CCS University. He has keen interests in doing extensive research and writing on legal subjects especially on corporate law. He is a creative thinker and has a great interest in exploring legal subjects.

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