Indian agricultural warehousing and lending company Arya.ag is testing tokenized warehouse receipts for stored grain on the Avalanche layer-1 blockchain. The initiative aims to create a shared digital record of grain ownership, collateral pledges, and loan status across lenders.
Arya.ag is partnering with Finternet, which will combine farmer, commodity, warehouse, and insurance data into what it calls a "composite token." According to Finternet Labs director Sanmesh Kalyanpur, this token will help banks assess collateral risk by providing verified information about stored grain.
Arya.ag currently stores approximately $2 billion in agricultural commodities across its warehouse network and supports about $1.26 billion in loans annually through its lending arm, Arya Dhan, which issues roughly $230 million in loans each year. The companies have not disclosed a launch date or the scale of grain and lending the initial deployment will cover.
Warehouse Receipts and Agricultural Lending
Electronic warehouse receipts allow farmers and agricultural businesses to borrow against commodities held in storage rather than selling immediately after harvest. A shared blockchain record would enable lenders to verify what grain is stored, its ownership, whether it is already pledged as collateral, and outstanding debt levels.
The system will still depend on accurate verification of the physical commodities underlying the digital records. In 2024, the Indian government launched a 10 billion-rupee credit-guarantee program designed to encourage financing against electronic negotiable warehouse receipts, particularly for small and marginal farmers.
Broader Context
The Finternet concept underlying this initiative was outlined in a 2024 Bank for International Settlements paper co-authored by Infosys co-founder Nandan Nilekani and then-BIS General Manager AgustÃn Carstens. The paper proposed interconnected unified ledgers for tokenized assets while emphasizing the importance of supporting legal and regulatory frameworks.
