Hans BogaardHead AgriBusiness – Rabo Development         Netherlands
Financing Coops & SMEs in                  developing markets                  The Rabobank approachJune 18, 2012   Hans B...
Rabo Development: business model
Focus Countries of Rabo Development
RD Agribusiness Advisory Services: 2 pillars                                      Agribusiness                            ...
Nr. of SME farmers reached via RD             Brazil       Sicredi          1.600.000             Paraguay     Banco Regio...
Segmentation drives financing approach                                       Large             Relationship approach, ofte...
Segmentation drives financing approachRisks      • Lack of collateral   •   Lack of scale                   •   Lack of sc...
Key success factors cooperatives•   Stick to economic and business-like principles•   Adequate governance structure•   Con...
Financing and TA must go together…    1.    Emerging farmers Zambia:    • Enterpreneurial growth oriented farmers:    • Su...
Conclusions•   Agriculture needs scale & skills at all levels (farm/coop/warehouse/etc)•   But communal land structure ham...
Thank you for yourkind attention
Upcoming SlideShare
Loading in …5
×

Session I - Part2 - Hans Bogaard - Rabo Development

834 views

Published on

0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
834
On SlideShare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
5
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Session I - Part2 - Hans Bogaard - Rabo Development

  1. 1. Hans BogaardHead AgriBusiness – Rabo Development Netherlands
  2. 2. Financing Coops & SMEs in developing markets The Rabobank approachJune 18, 2012 Hans Bogaard Rabo Development
  3. 3. Rabo Development: business model
  4. 4. Focus Countries of Rabo Development
  5. 5. RD Agribusiness Advisory Services: 2 pillars Agribusiness Advisory Capacity Building Supply Chain Finance (banks & coops) solutions Knowledge management & Emerging Farmers benchmarking Programs Agri Finance Out grower schemes Organization Agri Finance Cooperative financing Training Cooperative Warehouse Receipt Capacity Building Financing Farmer portfolio restructuring Pre-export finance
  6. 6. Nr. of SME farmers reached via RD Brazil Sicredi 1.600.000 Paraguay Banco Regional 11.459 China URCB 11.666 Mozambique Banco Terra 5.251 Zambia Zambia 4.414 Tanzania NMB 278.685 Rwanda BPR 42.307 TOTAL 1.953.782
  7. 7. Segmentation drives financing approach Large Relationship approach, often USD lending Traditionally bankable farmer/ agribusiness Retail approach, standardization (+ Technical Assistance) Emerging farmers Previously unbankable Value chain approach (e.g. out grower schemes), use cooperatives for risk Commercial smallholder management Via SACCOs, coops, etc Semi commercial smallholder
  8. 8. Segmentation drives financing approachRisks • Lack of collateral • Lack of scale • Lack of scale • Price risk • Price risk • Lack of skills • Lack of skills/management • Lack of commodity exchange • Skills • Lack of collateral/title • Lack of capitalization • Logistics/storage • Drought/floods • Corporate governance • Performance risk • Cash crops: side selling • Post-harvest handling • Skills • Food crops: government • Lack of WHR system • Raw material supply interference • Side selling • Access to markets • Price risk • Government export/import bans Traders & Agro dealers Farmers Cooperatives processorsCredit • Agro dealer • Outgrower schemes • WHR financing • Pre-export financeProducts schemes • Input financing • Collection finance • Pre-import finance • Save-for-loan schemes • Pre-export finance • WHR finance • Investment finance • Investment finance • Investment finance • Farmer credit score cards • Value chain finance
  9. 9. Key success factors cooperatives• Stick to economic and business-like principles• Adequate governance structure• Consistent business discipline (zero-loss & capitalization policies)• Do not mix up governance and management• Communication with members• Clear and business-like legislation
  10. 10. Financing and TA must go together… 1. Emerging farmers Zambia: • Enterpreneurial growth oriented farmers: • Support provision is key – Technical:  Mechanisation & agronomic TA  Provide finance to mechanisation agents – id key farmers/business persons in each district who can run mechanisation as a business • Zanaco currently financing 130 emerging farmers 2. WHR finance to Cashew/coffee coops in Tanzania • Technical assistance to government/CFC to set-up the WHR system • Technical assistance to NMB to develop WHR finance product • NMB currently leading WHR financing in cashew and coffee3. Value chain financing to rice unions in Rwanda• Technical assistance to the government to solve key sector bottle-necks• Technical assistance to BPR to develop rice financing strategy• Technical assistance to selected coops to improve management• Currently implementing input financing scheme to Rice Unions (60,000 farmers) to replace government input finance program 4. Restructuring emerging farmers South Africa • Technical assistance to Land Bank to restructure 400 emerging farmers • Develop score card to rate farmers and advise restructuring approach • Train 160 staff members (commercial and risk) to implement new approach • Should lead to better agri finance services to South African emerging farmers
  11. 11. Conclusions• Agriculture needs scale & skills at all levels (farm/coop/warehouse/etc)• But communal land structure hampers consolidation• This results in lack of mechanisation and irrigation• Lack of competitiveness results in consistent imports of food crops• Current market trends drive integration and sector professionalisation• Agri finance is challenging due to fragmentation & weak value chains• Sector & Segmentation based approach is key• Tailored products/concepts for different agri-segments• Branch network with local agri expertise is key• Combining access to finance with technical assistance
  12. 12. Thank you for yourkind attention

×