IDH Farmfit Fund

Overview

The IDH Farmfit Fund is a public-private impact fund dedicated to enhancing the livelihoods of smallholder farmers by investing in sustainable agribusinesses. The fund employs an innovative financing model that de-risks investments in smallholder farming, making them more attractive to commercial investors and facilitating access to affordable, long-term financing for farmers. The fund's strategy involves taking high-risk positions in smallholder value chains, utilizing financial instruments such as guarantees, subordinated loans, and equity investments. It focuses on sectors including food, staple and cash crops like cocoa, coffee, cotton, palm oil, tea, aquaculture, soy, cassava, rice, and other commodities. The geographical focus spans developing countries in Africa, Asia, and Latin America. Since its inception, the IDH Farmfit Fund has demonstrated a commitment to measurable impact, aligning with sustainability goals and promoting climate-smart agriculture. It has attracted a coalition of partners, including commercial banks, development banks, government bodies, and value chain companies, to support its mission of improving smallholder farmers' access to finance and enhancing their productivity and income. The fund's investment philosophy centers on reducing the financing gap for smallholder farmers by providing tailored financial solutions that address the unique challenges of the agricultural sector. Through strategic partnerships and innovative financing, the IDH Farmfit Fund aims to create scalable and sustainable business models that benefit both investors and smallholder farmers. In its pursuit of impact, the fund has engaged in various initiatives, such as a partnership with Oikocredit to unlock trade finance for coffee and cocoa producer organizations in Latin America and the Caribbean. This collaboration aims to de-risk lending and expand access to affordable credit for smallholder-focused producer organizations, thereby strengthening rural value chains and improving farmers' livelihoods. Overall, the IDH Farmfit Fund plays a pivotal role in bridging the financing gap for smallholder farmers, fostering sustainable agricultural practices, and contributing to the economic development of emerging markets.

Investment Focus

• Attributable benefit to smallholder farmers
• Geographical focus on developing countries in Africa, Asia, and Latin America
• Sectors including food, staple and cash crops, aquaculture, and other commodities
• Financial instruments such as guarantees, subordinated loans, and equity investments
• Tenor up to 10 years
• Commitment to sustainability and climate-smart agriculture practices

Portfolio Companies