Fairtrade Access Fund

Equity : October 2019

The Fairtrade Access Fund is a social impact, evergreen multi-regional debt fund.

Amount

€ 3,000,000.00

Type of investment

Equity

Development impacts

Local economic growth
Private sector consolidation/innovation
Financial inclusion
Food security & rural development
Fight against climate change
Promotion of ESG best practices

Beneficiary locations

Africa: Burkina Faso, Côte d'Ivoire, Ghana, Kenya, Tanzania, Uganda

Latin America and Caribbean: Bolivia, Brazil, Colombia, Ecuador, Guatemala, Honduras, Paraguay, Peru

Investment field

Investment Companies & Funds

Activity

SME Fund

Organisation

Fairtrade Access Fund

Website

http://incofinfaf.com/about-us/

Domicile

Belgium

More investments in

Fairtrade Access Fund

Subsidy € 350,000.00 (2020)

The Fairtrade Access Fund (FAF) is a regulated evergreen fund founded in 2012 and operates in Latin America and Africa, offering lending products for cooperatives, processors and agricultural exporters who work primarily with smallholder farms and have a strong commitment to sustainable development. The fund currently supports around 250,000 sustainable and Fairtrade certified farmers.

The FAF aims to achieve the following objectives:

Contribute to the development of a fair and sustainable agriculture sector.
Address the financial needs and technical assistance of smallholder farmers by providing better access to financing (especially long-term capital) to improve their operations, to gain access to sustainable markets and provide critical information to enhance and improve their yields, prevent or mitigate the impact of diseases etc.
Provide a fair return to investors.

Portfolio

Since its inception, the fund’s portfolio has grown steadily with a strong focus on portfolio quality and diversity. It established a firm foot-hold in the agricultural finance space by developing a multi-regional and multi-crop portfolio, with following focus:

Investee type: the portfolio is comprised of producer organizations, traders/processors, agricultural focused microfinance institutions and Fairtrade plantations
Product: offering a combination of trade finance, working capital and long term loans.
Crops: well diversified with investments in over 11 different crops.
Geography: investments in over 19 countries across Latin-America and Africa.

Development impacts

Local economic growth
The fund provides part of its financing in form of long-term loans to players that traditionally face difficulties to obtain long-term finance for infrastructure projects.
Private sector consolidation/innovation
Through its loan products the fund serves smallholder farmers and cooperatives that have been underserved so far and that crucially need financing in form of trade, harvest and long-term finance to stabilize their income streams.

The fund manager is an established partner of BIO and has ample experience in providing financial services to the food & agricultural sector. The other international sponsors of the fund add valuable expertise as well.

The fund provides technical assistance through a TA facility to enhance the investees' productivity, support certifications and improve governance.
Financial inclusion
Part of the fund’s portfolio is directed towards financial services providers that are not themselves part of the agricultural value chain but provide supporting services to producers and that address fair trade or sustainable certified smallholder farmers.
Food security & rural development
The fund's focus on sustainable and Fairtrade certifications ensures that farmers receive a premium on their produce, insuring them against fluctuations in the world prices and providing sustainable incomes.
Fight against climate change
Through its investments in sustainably certified agricultural projects the fund supports the conservation of natural resources and biodiversity.
Promotion of ESG best practices
All investees are Fairtrade and/or sustainable certified or in the process of obtaining the certification.

Fairtrade Standards encourage democratic leadership, administrative efficiency, transparent accounting and improved governance.

Made possible through this investment

Thanks to the direct funding from BIO, the following second-line investments have been made possible.

Agribusiness

Benin, Burkina Faso, Côte d'Ivoire, Democratic Republic of Congo, Kenya, Madagascar, Rwanda, Tanzania, Togo, Tunisia, Uganda, Bolivia, Brazil, Colombia, Ecuador, Guatemala, Honduras, Paraguay, Peru, Chile

Debt fund investees