2021 - ongoing
In support of an International Fund for Agricultural Development (IFAD) programme towards sustainable agrifinancing, CIAT would like to subcontract FACS to develop a high-level desk research report which contributes to the identification of five best investment opportunities in West Africa. The research is intended to identify key pipelines for financing in the sub-region by providing an overview of the efficacy of impact investment and other novel financial instruments (incl. from climate finance).
FACS will use the following stepwise approach: (i) Review of investment portfolios of key impact investors in West Africa with a focus on agriculture and climate. (ii) Assessment of common business models that impact investors are involved in. The various business models in the investment portfolios will also be identified and categorized. (iii) Review of literature on the investment climate and environment across Ghana, Nigeria and Mali especially as related to impact investment or financing climate smart agriculture. This review will highlight cross-cutting as well as idiosyncratic challenges and enablers for the various financial instruments that are commonly deployed by impact investors.
2021 - ongoing
Corrie MacColl has developed an outgrower program for rubber smallholders to establish an integrated farm of rubber, cash crops and livestock lending scheme. The program aims to boost the economic livelihood of its smallholder partners by providing a combination of farming loans and critical education on farm management. Lending will be routed to the outgrower programme through MITFUND, managed by Afriland First Bank.
FACS will support the partner financial institution to onboard smallholders to the outgrower lending scheme by conducting a credit risk assessment of the 200 targeted smallholder farmers. FACS will also conduct farmer data collection for credit profiling and review the cashflow models. The activities include the provision of individual credit risk scores and assessment report for both bankable and non-credit worthy farmers.
2021 - ongoing
World Poultry Foundation
The World Poultry Foundation (“WPF”), with support from the Bill & Melinda Gates Foundation (‘BMGF”), FMO, Rabobank Foundation and IDH Farmfit Fund, has developed a program in selected countries in Africa to improve income generation for small agri entrepeneurs and to enhance food security and public health nutrition through the delivery and financing of brooders of chickens (“brooder units” or “BUs”). The program aims to recruit, train and finance 6,000 small rural entrepreneurs, who will develop and operate the BUs.
FACS will provide financial advisory and technical support services to enable the provision of working capital finance to the BUs in Tanzania under supervision of WPF. To do so, FACS will conduct an in-depth analysis of the rural (micro)finance sector in Tanzania, identify and assess qualified potential lenders and to support WPF/BMGF in the selection of a rural lending partner. The investment scheme, BU loan product and loan distribution model will be designed to enable replication, expansion and to create scale of the lending program beyond Tanzania.
The Council on Smallholder Agriculture Finance (“CSAF”) is the leading global network of lending practitioners promoting an inclusive finance market for agriculture SMEs. The forum was founded in 2012 and now includes 16 members and affiliates committed to market growth and impact. One of the objectives of CSAF is to develop and launch basic principles that members can follow during loan restructuring and workouts.
In this context, Financial Access engaged with CSAF to design and deliver a training program to the global and regional staff of CSAF to increase members’ understanding of the key principles of loan restructuring and workout programs.
2021 - ongoing
In January 2020, the AGRI3 Fund was launched with the objective to catalyse private financial resources for forest protection and sustainable agriculture. The AGRI3 fund aims to unlock at least USD 1 billion in finance towards deforestation-free, sustainable agriculture and land use. In this regard, the AGRI3 Fund is working with its partners Rabobank and IDH on the identification of key priority investment opportunities and on developing a pipeline of potential sustainable investment transactions in the oil palm sector in Indonesia.
Financial Access has engaged with IDH to support the development of the investment pipeline and implementation of the AGRI3 Fund’s investment strategy in Indonesia, thereby focusing on (i) identifying key stakeholders and assess financial and investment needs across the oil palm supply chain, (ii) supporting business case development and (iii) identifying potential target investment opportunities.
2020 - ongoing
In West-Kalimantan, the existing mosaic landscape is at risk of being turned into oil palm monocrop plantations. The local Dayak community has interest to maintain the existing landscape and sound business cases can help to do so. Therefore, Tropenbos International (“TBI”) and Tropenbos Indonesia (“TI”) are conducting a feasibility study to assess the economic viability of several agroforestry systems in the area. The objective of the study is to develop an alternative to agricultural monocultures of agri-commodities that can contribute to improving the livelihoods of local communities while preserving forest and biodiversity.
Financial Access will work closely with partner DIBcoop to prepare and present investment cases to local financial institutions and impact investors. Furthermore, Financial Access will develop and provide training on business case development for the staff from TBI.
2020 - 2021
Solidaridad West Africa
Although oil palm is native to West Africa, Africa as a continent is a net importer of palm oil, with production accounting for just 3.5% of global production. The growing international demand for edible oil, cosmetics, biofuel, lubricants, surfactants, energy, and other applications has boosted the growth of palm oil activities in Africa. In this context, in collaboration with APOI and in alliance with Proforest, TFA is commissioning research and analysis of the investment situation in the oil palm sector in APOI countries with the objective of building an investment case for oil palm development that creates jobs, protects the environment and improves rural development and livelihoods.
FACS, together with Solidaridad West Africa, will develop an investment analysis across the 10 APOI countries and identify three investment opportunities to boost the palm oil sector in West and Central Africa.
Rubber production is a key income stream for several million smallholders in South East Asia. However, Indonesian smallholders are trapped in a vicious cycle of low yield and low international rubber prices. In order to improve the socioeconomic and environmental performance of the natural rubber value chain, the Global Platform for Sustainable Natural Rubber (“GPSNR”), is seeking to investigate how value can be equitably distributed across the entire natural rubber chains. The study is funded by the German Federal Ministry for Economic Cooperation and Development (BMZ).
In this context, Financial Access is engaged to conduct an in-depth analysis on the living income gap of smallholders in Kalimantan, Indonesia.
2020 - ongoing
The productivity and quality of the rubber produced in Indonesia remains low mainly due to a lack of knowledge on cultivation techniques. Our partner SNV has designed a program to promote responsible sourcing in South Sumatra. As part of the scaling up strategy of sustainable natural rubber practices, SNV is building an integrated system through training centers as well as improving market access through a collaboration with Kirana Metagara Group, a rubber offtaker.
In order to set up a viable financing mechanism for rubber smallholder farmers, Financial Access will help to assess the level of readiness of stakeholders as well as conceptualize the building blocks required for replicability and scaling up of the program.
The performance of micro, small and medium enterprises (MSMEs) in markets and socio-political arenas – and their ability to have a voice — is essential for achieving sustainable landscapes that are resilient to external shocks, such as changes in markets, policy or climate. To strengthen both the performance and voice of MSMEs they need to have access to resources, including finance. One of the main barriers to access finance for MSMEs is lack of financial literacy. Financial Access was engaged by Tropenbos International (TBI) to conduct a study of current experiences and to develop a strategy to strengthen the financial literacy of MSMEs in the landscapes and value chains where TBI and its partners work.
This publication has been produced by Financial Access and TBI in the framework of the innovative finance for sustainable landscapes priority of the CGIAR Research Program on Forests, Trees and Agroforestry (FTA). See the full report here.
2020 - 2021
The largest cocoa-growing area of Ghana is plagued by falling yields and persistent pests. The Sustainable Cocoa Farmer Finance (SUCOFIN) project was developed by Financial Access, in partnership with SNV Ghana, to build the capacity of partnering local microfinance institutions and to support them in offering finance for cocoa renovation and rehabilitation to pre-qualified smallholder farmers. A graduation approach is developed where smallholder farmers will be credit scored to receive input loans. Once these loans have been repaid after one planting season, farmers will become eligible for larger and longer-term loans over time. This helps to build the trust and understanding required by both sides before long-term replanting finance can be extended. By working closely with SNV we also ensure that post-disbursement replanting and sustainable farm management support and training are available to the farmers to help them maximize yields and improve their livelihoods.
2019 - 2021
MoMo4C is a program funded by the Dutch Ministry of Foreign Affairs that aims to bring together private sector firms, policymakers, investors and civil society organisations to develop ‘green business propositions’ that tackle the impact and causes of climate change at landscape level in developing countries and to attract private investment to implement these initiatives. In Uganda, MoMo4C concentrates on the retention and expansion of the corridors between the Bugoma and Budongo forest reserves in the Kinyara landscape. These corridors are required to ensure free movement of wildlife between these reserves and to maintain a balanced ecosystem.
FACS, with the support of Ecotrust, supports MoMo4C with an analysis of the agriculture and other economic activities in the Kinyara landscape, with a particular focus on sugar outgrower plantations. FACS conducts a detailed assessment of the financial investments required and engages with private sector enterprises, financial institutions and other stakeholders in the Kinyara landscape with the ultimate objective to develop and implement a market-based, climate-smart landscape investment model.
MoMo4C is a program funded by the Dutch Ministry of Foreign Affairs that aims to bring together private sector firms, policymakers, investors and civil society organisations to develop ‘green business propositions’ that tackle the impact and causes of climate change at landscape level in developing countries and to attract private investment to implement these initiatives. In Ghana, MoMo4C aims to develop a healthy and climate resilient ecological landscape with thriving communities in and around Mole National Park, a protected wildlife reserve. MoMo4C aims to address these issues by working with local communities, smallholder farmers, companies and government agencies to create models for climate resilient savannah woodland management.
FACS supports MoMo4C with an analysis of the agriculture and other economic activities in the Mole landscape, assessment of the financial investments required and engagement with partner financial institutions to develop and implement innovative, market-based and tailored investment solutions that would lead to environmentally sustainable, climate-smart and socially responsible agriculture at landscape level.
2019 - ongoing
FACS is supporting the 2SCALE programme in their mission to accelerate a portfolio of Public Private Partnership for inclusive business in agrifood sectors and industries in eight countries across Africa.
More specifically, FACS will offer tailored investment advice and deliver technological solutions to improve financial inclusion for small agri-enterprises and smallholder farmers for 2SCALE partners in all project countries.
Next to that, FACS provides capacity building, use data analytics, and broker financial services aiming at matching the financial demand-side and supply-side.
2019 – ongoing
G4AW / The Netherlands Space Office
Within the Sat4Business programme, FACS, together with consortium partners Solidaridad, Satelligence, Akvo, Esoko and the Ghana Ministry of Food and Agriculture, will create an interactive digitial platform that facilitates access to finance for smallholder farmers by providing credit scores to lending institutions on these farmers to aid credit decisions and provides agriculture advice and market information to smallholder farmers to enable them enhance productivity on and improve incomes from their farmers.
The programme seeks to achieve for oil palm and cocoa smallholder farmers in Ghana: a) increased food production; b) increased income and; c) job creation. The digital platform will provide a cost-effective way for credit institutions, input dealers, micro pensions and micro-insurance providers to reach targeted smallholders at scale.
2019 – 2020
Wildlife Conservation Society
In a project to protect the third largest protected area in Sumatra from encroachment by smallholder coffee farmers, the Wildlife Conservation Society engaged Financial Access to understand the key challenges facing these smallholders and the main drivers of encroachment. As farm yields, and hence incomes, are low for these smallholders, intensification of farm plots outside of the park is a key condition for stopping encroachment. An effective financing mechanism to support the farmers and to enable them to purchase land outside of the park are vital elements in this approach.
After building a strong understanding of the farm dynamics and supply chain, several possible financing schemes were identified. A preliminary business case was presented to local financial institutions to understand their willingness to extend loans to the smallholders and to analyze the barriers that currently stop them from doing so.
2019 – 2020
World Wildlife Fund
Together with a large American retailer, WWF set out to study the potential of old rubber trees providing both a sustainable source of wood suitable for furniture manufacturing, as well as providing smallholder rubber farmers with a much-needed inflow of cash during their replanting process.
The main hurdle to creating a strong business case for the processors is scale, as significant costs are involved in both the transport and processing of rubber wood. The business case for smallholders is more easily identified, as selling old rubber trees provides a large amount of cash with which the need for financing for replanting can be significantly decreased. Significant outreach to timber mills, processors and factories was conducted to understand their financial and scale requirements need to be fulfilled to make rubber wood processing a profitable proposition. You can read the full study here.
2019 – 2020
USAID Green Invest Asia
This wide-ranging study, conducted jointly with SNV, aims to provide a comprehensive overview of the rubber smallholder landscape in Indonesia and their financial needs, and to identify possible channels through which these needs can be sustainably addressed.
Starting with an overview of past and present government programs targeted at rubber smallholders build the framework in which to work. Second, extensive field work was conducted to understand the financial position, needs and opportunities of smallholders at a regional level. Leading rubber plantation companies were also interviewed to build a better understanding of the supply chain and how actors within it can be leveraged in a financing scheme. Third, financial institutions were interviewed to understand the real and perceived hurdles in providing financing to rubber smallholders. See the full report here.
2019 - ongoing
The DFAT-funded GREAT program aims to improve the economic livelihoods of women of ethnic minority groups in north-west Vietnam by increasing their capacity and through improved private sector development and better access to markets and finance. Financial Access’s role in the program is to leverage the work of the program to enhance the financial inclusion of the smallholder farmers. We conducted an extensive analysis of the supply chains, to create a detailed understanding of its dynamics and the opportunities for assisting farmers with tailored financial products. By working with a large financial institution, we will co-design appropriate financing schemes and offer these with increased efficiency and cost-savings to smallholders in this remote region.
Though a staged approach, continuously increasing the number of farmers reached and incorporating learnings in new loan cycles, we aim to create a sustainable path to financial inclusion for these female ethnic minority smallholders.
Corrie MacColl is one of the leading rubber producers and processors in Cameroon. As part of a large outgrower scheme, it is looking to help over 10 thousand smallholders grow 2-hectare rubber plantations over a 12-year period. Financial Access analyzed different intercrops that farmers could plant, to maximize their income during the immature period of the rubber trees. After this mix was identified, an extensive study of the financial implications for both Corrie MacColl and a financial institution was undertaken. Various options of the company’s financial involvement in the financing scheme were analyzed and summarized in an investment case, which was presented to selected financial institutions. Finally, smallholders were surveyed to determine whether they would qualify for the first batch of loans, to help them (re)plant rubber trees to increase their incomes and livelihoods.
ECOM Sustainable Management Services
As one of the leading coffee traders globally, ECOM has an extensive network of coffee smallholders in Sumatra, Indonesia. Financial Access was contracted by ECOM to analyze the data on its smallholder supply base and use its outcomes to build a business case for financial institutions to provide working capital loans to these farmers.
After extensive analysis a field study was conducted to validate its findings and structure a tailored financial product that would address the finance requirements of the coffee smallholders and improve their livelihoods. As the farmers were geographically dispersed, a regional financial sector mapping was conducted to understand the financial landscape and identify potential partner institutions. To gauge their willingness to engage with targeted smallholders, the investment case was presented to selected smallholder lenders.
2018 – 2019
Partnership for Forests
The Climate Smart Lending Platform is a pioneer platform designed to enable financial institutions and tool providers to engage with smallholder farmers and catalyse investment into improving their resilience to climate change. The long-term goal of the Platform is to mainstream Climate-Smart Agriculture (CSA) metrics into the credit scoring systems of financial institutions without concessional backing in order to improve agricultural lending portfolio resilience to climate change, and to create strong incentives for farmers to adopt CSA practices and to harness the private finance necessary to do so.
The Climate Smart Lending Platform has been developed through a partnership with F3 Life. Partnerships for Forests has been supporting us in setting up a MVP that offers a solution that is replicable and scalable, aiming to enable access to climate smart finance for large numbers smallholders at low costs and manageable risk for loan providers.
2018 – 2020
G4AW / The Netherlands Space Office
The objective of the SAM Programme is to empower maize smallholder farmers, to improve their farming practices, yields as well as market and financial access. It does so by providing tailored information, based on their current practices and location by our partners ImpactTerra, Satelligence and Wageningen University.
As their current farm management is severely constraint by their ability to buy proper inputs, Financial Access will work with Microfinance Institutions to expand the smallholders’ access to finance. We do so by tailoring our digital solution LendXS to the partner institution, to make their loan origination process more efficient and bring down costs for more geographically dispersed farmers in particular. The system enables them to collect farmer data more easily and create de-risked lending portfolios to accelerate the delivery of affordable financial products to these farmers in a scalable manner.
The objective of the West Africa R&R Cocoa Financing Initiative (WACOFIN) programme is to assess and evaluate current cocoa replanting schemes and practice in Ghana and Cote d’Ivoire. Besides that, FACS recommended long-term financing solutions for cocoa replanting towards a more sustainable and responsible cocoa supply chain in Ghana and Cote d’Ivoire.
As part of this assignment, we analyzed past and current financing schemes and policies and evaluate relative effects and outcomes in terms of farm productivity, smallholder livelihoods and sustainability. Next to that, we conducted research on the potential and scalability for innovative financing schemes for cocoa smallholders by assessing investors’ risk profile and appetite as well as the required enabling environment. The output of our analysis served as the outline of a pilot financing project that aims to de-risk cocoa replanting.
2017 – 2018
Climate Policy Initiative (CPI)
For this project Financial Access designed a new sustainable business models for oil palm smallholders in East Kalimantan, Indonesia. After a detailed supply chain mapping the focus area of Berau was chosen as the pilot area. There smallholders’ finances and farm management were studied to build a minute understanding of the oil palm business model. This was used as input for building a farmer risk assessment methodology that includes both detailed risk profiling as well as an early identification system for pre-screening bankable and non-bankable farmers.
Concurrently the financial landscape was mapped to understand which financial institutions could offer services to the smallholders. Taken together with the smallholder data, clear financial and non-financial intervention needs of farmers were identified and potential pilot for the different opportunities were designed.
2017 – 2020
The Embassy of the Netherlands in Indonesia
To build on and leverage the work performed in the Berbak Green Prosperity Programme, Financial Access was mandated by the Netherlands Embassy in Jakarta to implement the replanting finance model and mobilize replanting financing for at least 500 farmers. To ensure our approach would be sustainable and bring tangible benefits, the company PT Kreditek Financial Access was established to digitize client onboarding and build customized credit scoring software. This enabled us to present an attractive investment opportunity for bank that would have positive effects on their overall operation.
A provincial development bank was our financial partner in the project and it extended working capital loans to many smallholders, to build up their credit history, with the goal of graduating them into a replanting finance scheme over time.
2017 - 2018
AATIF Technical Assistance Facility
The objective of this project is to assess the feasibility of implementing Climate-Smart Financing Packages for cocoa and maize farmers in Ghana. The ultimate goal of the project is to improve their resilience to climate change effects.
FACS designed a provisional climate-smart finance package adapted to WIENCO’s in-kind credit scheme. We suggested alternative climate-smart finance package replacing the current WIENCO in-kind credit schemes. Next to that, we recommended terms of financial products included in the financial package (amount, tenure, grace period, interest rate, discounts, repayment method, risks covered, etc.) and appropriate climate-smart agriculture and land management requirements. Lastly, we developed an operational plan for piloting the climate smart finance package, necessary institutional and operational arrangements as well as headline program cost. The assignment concluded with an assessment of the scale-up potential.
The main objective of the assignment is to conduct a feasibility study on agricultural finance in Malawi and Zambia, in order to provide FINCA Malawi and FINCA Zambia with pragmatic advice on how and where they can start agricultural lending operations, and grow their respective loan books in an efficient and profitable manner.
As part of the assignment, Financial Access assessed the value chains, actors, key risks, and agricultural financing opportunities in Malawi and Zambia, in order to identify potential strategic partnership opportunities to strengthen the product offering, and to recommend to FINCA on how to strategically and operationally embrace financing the agribusiness sectors of both countries. In order to complete this assignment, we conduced primary data collection and combined that with secondary data, to select developed agricultural value chains with a risk-tolerant potential for financing.
Millenium Challenge Account
The Berbak Green Prosperity Programme engaged Financial Access to develop the oil palm commodity component of the Programme. FACS developed a tailored replanting financing scheme and risk assessment system to address the replanting needs of smallholders in the Jambi region in Indonesia, with the aim of graduating farmers and strengthening the palm oil value chain.
After extensive data collection on over 1500 farmers in the region, a preliminary risk assessment was conducted to understand the bankability potential at the individual farmer level. Using both quantitative and qualitative insights from the field, a financing scheme was designed and its feasibility was validated with local banks. This led to the development of strong business cases for palm oil replanting in combination with income diversification through the cultivation of alternative crops during the non-productive period of the new trees.a
2016 - 2017
AIP – SAFIRA
The Australian SAFIRA program at large aims to strengthen agricultural finance in rural areas. The objective of the SUMFAF project fit well within this framework as it had the goal to prepare a local MFI for significant volume growth for farmer loans by creating the required operational capacity, processes and governance structures to create the conditions for economies of scale. Activities involved the mapping and optimization of the workflow and credit application process and the development and implementation of an IT tool as well as training the MFI’s staff in the use of the tool and new procedures. The tool automates the workflow process and serves as a credit scoring tool and can be used from data collection to loan monitoring, improving decision making across the loan cycle while bringing down costs and the time spent filling out paper forms.
2015 - 2017
The Embassy of the Netherlands in Indonesia
With support from the Netherlands Embassy in Jakarta, Financial Access partnered with HCC/INA (Benelux-Indonesia Chamber of Commerce), Agros Finance to support numerous Indonesian financial institutions to develop their key agri-lending and risk management processes. The program furthermore established agriclutural cooperative and enhanced the access to finance for these organizations and their 5,000 smallholder sustainable nutmeg farmers. The main financing need was the purchase of ovens, to improve the drying process of produce.
Major improvements implemented include the structuring of new, tailored, financial products and services, improvement of internal workflow processes, implementation of Environmental & Social Risk Management policies and processes, and the design and implementation of a credit scoring system for agricultural loans.
Financial Access, working in close collaboration with SNV, has written a research paper titled “Current Practices and Innovations in Smallholder Palm Oil Finance in Indonesia and Malaysia.”
The paper is based on a large-scale research effort to map past and current policies and financing schemes for oil palm smallholders in the two countries. It goes on to detail innovative financing schemes that have been implemented in the past and evaluates their effectiveness in reaching smallholder farmers. By doing so it also identifies the conditions that enable these schemes to foster sustainable and inclusive development.
Finally, all this information is synthesized to define long-term financing solutions for smallholders that at the same time promote a sustainable supply chain.
The research paper was published by the Center for International Forestry Research (CIFOR) in October 2017.
Financial Access undertook an in-depth study on existing innovative financing models for oil palm smallholders, and their potential to be scaled up, improve rural livelihoods and support deforestation-free smallholder farming in Indonesia. This culminated in a report titled “Innovative Replanting Financing Models for Oil Palm Smallholder Farmers in Indonesia” published by the Tropical Forest Alliance 2020 in October 2018.
The report details the current challenges in conducting oil palm replanting and presents a detailed analysis of five case studies where plantation companies established financing schemes for smallholders. It furthermore analyses how further involvement of the financial sector and the Government of Indonesia can create the enabling conditions for up-scaling these schemes to further improve livelihoods and support deforestation-free supply chains.
2013 - 2016
Embassy Netherlands in Nairobi
The F4A programme was designed and developed to bridge the gap between financial institutions and the agricultural sector and in particular was aimed at increasing agricultural lending to MSME agribusinesses and agricultural producer organizations.
Firstly, the programme was aimed at strengthening the capacity of committed financial institutions to a) improve their practical sector knowledge; b) design relevant agri-finance products and; c) provide them with adequate credit monitoring and risk mitigation tools.
Secondly, introduction of an (Agri) Supply Chain Platform offered to financial institutions on a ‘managed services’ basis.
Thirdly, work with the agricultural sector to identify the more promising emerging farmers, producer associations, co-operatives, aggregators and agri-businesses with the objective to create, maintain and disseminate a pipeline of bankable and commercial propositions
The F4A programme in Uganda was designed and developed to bridge the gap between financial institutions and the agricultural sector and in particular was aimed at increasing agricultural lending to MSME agribusinesses and agricultural producer organizations.
The F4A programme consisted of the following key objectives: a) boost Agri-finance know how and expertise for FIs; b) introduce SCF as an innovative product in Agriculture value chains; c) active pipeline building re commercial entities in need of Agri-financing; d) identify and build capacities of agribusiness in key commodity sectors and e) rate agribusiness bankability and link those with high ratings to access financing opportunities.
Within this project, we worked with 15 financial institutions, of which 5 of them with comprehensive capacity building programmes and an additional 10 with a training programme on Agriculture Value Chain Finance.
Social Fund for Development
To identify key prospective areas for the bank in the light of conducting a market survey, design products accordingly and submit a finalized strategy based on above. FACS undertook a market survey of Egyptian Agri finance sector, bank’s strengths and weaknesses, products design, implementation design and training of the staff according to needs identified. The assignment culminated in to drafting a strategy report based on findings and global best practices as applicable in the local context.