In this book the link between chain actors and financial institutions is described as a means to deepen financial services for value chains. Value chain finance aims to address perceived constraints and risks by providing innovative ways of delivering financial services to rural producers and agribusinesses. Value chain finance means linking financial institutions to the value chain, offering financial services to support the product flow, and building on the established relation- ships in the chain. It means that the product flow in the value chain is used as a carrier to provide financial services. This way of financing can spread risk among the financial institutions and chain actors and provides alternatives to traditional collateral requirements. It provides tremendous potential for unleashing capital, scaling up and sustaining chain prospects, but it needs to be managed and or- ganized well.
This book is the third in a series on value chain development by the Royal Tropical Institute (KIT) and the International Institute of Rural Reconstruction (IIRR) and is the logical follow up to the two other books. One is called Chain empowerment: Supporting African farmers to develop markets (2006) and the other is titled Trading up: Building cooperation between farmers and traders in Africa (2007). This book is the first to draw on worldwide experiences.
KIT and IIRR. 2010. Value chain finance: Beyond microfinance tor rural entrepreneurs. Royal Tropi- cal Institute, Amsterdam; and International Institute of Rural Reconstruction, Nairobi.