Financing Agriculture Forum 2015: Presentations

Financing Agricultural Value Chains
May 11-15, 2015 – Istanbul



Presentation Description


Day One: Forum Overview - Reaching Smallholders and Agricultural Micro-enterprises through Direct Lending Modalities

The presentation provided an overview of the opportunities for banks to enable financing to smallholders and micro-enterprises through value chain financing arrangements, or via cost-effective direct relationships. Utilizing Innovative technological solutions in addition to “boots on the ground” modalities were explored. 

Session One: Innovative Lending Mechanisms for Reaching Smallholders

The presentation focused on the innovative approaches of Centenary Bank Uganda, which utilizes both physical and technical tools, enabling lending to be directly provided to rurally dispersed smallholders and micro-enterprises in a cost-effective and profitable manner. The presentation was followed by a panel session comprised of lending institutions with proven track records of successfully financing smallholders and micro-enterprises. The discussants considered a range of approaches that can be employed to achieve significant outreach to smallholders in a sustainable way.

Session Two: Reaching Smallholders through Value Chain Finance

Representatives from lending institutions, a lead agribusiness and a farmer association, presented on how, through the use of value chain financing arrangements, thousands of smallholders are provided with improved access to finance. The actors detailed how the strength of the value chain relationships within the sorghum value chain enabled the expansion of financing in a sustainable and profitable manner.

Session Three: Designing Products and Processes to Sustainably Lend to Agricultural Micro-enterprises

Amret, a lending institution focused on their approach to financing agricultural micro-enterprises, through the utilization of value chain approaches combined with an innovative use of technology to facilitate assessment, disbursement, monitoring and recovery.  The examples from Cambodia and Zambia highlighted differences and similarities in approaches adopted.

Networking Reception

The smallholder financing facility set up by KCB with the IFC to help farmer cooperatives gain access to financing and training they need to expand food production will be presented.  As well as farmers gaining access to working capital through off-taker agreements with their cooperatives and supply contracts to the World Food Program, they receive additional technical advice provided by IFC and other partners.  The session looked at the structure of this value chain financing as well as key lessons learned.

Session Four: Lending to the Turkish Poultry Sector – Utilizing Value Chain Finance Techniques to Expand Financing to the Broiler Industry

These collaborative series of presentations from actors involved in the Turkish broiler value chain demonstrated how Yapi Kredi was able to expand financing utilizing the strength of the value chain relationships. The presentations detailed the role of each actor. The presentation was followed by a panel session in which discussants explored opportunities and challenges of financing domestic value chains within different markets.

Session Five: Improving the Enabling Environment for Lending to Agriculture – the Role of Credit Registries in Improving the Flow of Agricultural Finance

The presenter provided an overview of the Turkey Credit Registry and how its development has significantly improved the ability of Turkish banks to expand their lending to the agricultural and rural sectors.

Session Six: The Enabling Environment Required to Facilitate Value Chain Financing

Two banking associations shared details of the agricultural finance programs that they deliver to their membership to facilitate the expansion of agricultural lending in their countries. These programs include activities to both raise the capacity of banks to lend to the sector, and those activities that encourage regulatory improvements to overcome lending hurdles.

Session Seven: Utilizing Innovative Mechanisms and Technology to Enable the Flow of Funds to Agriculture

HDFC shared how they developed their innovative approach to the financing of dairy farmers through the provision of cattle loans, utilizing the relationship farmers had with their buyers. The program has proved highly successful and is a model example of how financing can be facilitated through the creative use of value chain relationships.

Session Eight: Value Chain Financing Guide

The World Bank team introduced the new Value Chain ‘How-to’ Guide developed in partnership with HBL, Pakistan, HDFC, India and Bankaool, Mexico. During the session the bankers and the AgriFin team showcased the guide, discussed how it was developed and its use to implement cohesive value chain financing programs in these countries and sectors.

Session Nine: Leveraging Value Chain Relationships to Increase Smallholder and Export Financing – the Case of Kenyan Horticulture

Through financing of multiple levels of the value chain, working with smallholders including financing investment in quality certification and financing and paying them on behalf of the export company, a sustainable and replicable model has been created and showcased.

Session Ten: Launch of the AgriFin Mobile Learning Application

The premiere of a new mobile application was introduced which facilitates the education of commercial bank staff in the technicalities of lending to agricultural value chains in developing countries.

Session Eleven: Enabling of Long Term Agricultural Investment Finance

Banco Continental  spoke on their highly innovative new product, designed to enable the financing of coffee tree planting.  The product was developed in light of the devastation caused by outbreak of the La roja coffee disease in Honduras and the subsequent need for replanting.  Banco Continental worked closely with both the  leading value chain actors in the Honduran coffee sector, and with the regulatory authorities, to design a long term lending product to support loans to farmers for replanting.