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Rabo Development

A story on finance for food

Pierre Schonenberg Finance for Food

Rabo Developments roots and mission


Rabobank was founded 110 years ago by farmers who did not have

access to financial services. Today, more than four billion people


worldwide still lack access to these services. Rabo Developments mission: Drawing on Rabobanks cooperative heritage and banking knowledge in the Netherlands, Rabo Development aims to increase access to financial services in developing countries that have substantial potential in the food and agri sector.

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Rabo Development partner banks and advisory projects 2012


Partner banks Advisory projects

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What does it take to become a successful F&A bank?

What does it take to become a successful F&A bank?

What does it take to become a successful F&A bank?

Traditionally bankable
Commercial farmers

Relationship approach, often USD lending

Traditionally Unbankable

Emerging farmers

Retail/SME approach with agri twist lack of financials, need for benchmarking, technical assistance on agro & financial skills

Commercial smallholders (cash crops)

Scheme based approach (e.g. out grower schemes), use Coops for coordination and aggregation
Via SACCOs, coops, saving based loan schemes, etc

Subsistance farmers

AGRI Department HQ Knowledge collection & dissimination Sector policy making Capacity building

Product development

Macro:

Agri-

Sector

Internal:

finance
Micro:

products

Policies:

External:

Branches
Agri-loan officers & Risk management
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Value chain approach should be leading


Asset Finance

Farmers

Coops

Processors

Traders

Save For Loan Credit score cards Outgrower schemes Emerging farmer programs

Input financing Raw Material Collection Financing WHR financing Cooperative capacity building

Working Capital WHR financing Trade & Commodity Finanance

Working capital

But a bank needs to serve more than only F&A:


Strategy review Customer segmentation Value proposition(s) Distribution channel management

Risk management
Information Technology (IT) Product management Human Resources Agri value chain solutions Agri sector knowledge Cooperative building Etc.
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Context of Rabo Developments activities


Equity Technical Assistance Management Services Financial Services

Access to financial services

Sharing international and cooperative banking knowledge and experience

Policy Dialogue Financial Instruments

Enabling Environment

Government

NGOs

Multilaterals

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Role public sector:


Develop a supportive legal and regulatory framework Building consistent and reliable data sources Building capacity of financial institutions in partnership

Funding / smart subsidies / risk sharing


Networker/matchmaking

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Key messages
A F&A bank needs commitment and investment for the sector A F&A bank sees long term business in development A F&A bank in a developing country can only be successful in cooperation with carefully selected (public) partners. Partnership must be based on the principle that each partner does what it can do best;

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Thank you for your kind attention


https://www.rabobank.com/en/rabo_development/index.html Rabo.development@rn.rabobank.nl

Rabo Development