NI-M1038 : Innovative Models for Providing Long-term Financing to Coffee Producers in Nicar

The most recent roya outbreak has severely affected Central American coffee producers with about 50% of the total coffee growing area affected by this fungus. The incidence rate varies from country to country but it is estimated between 20-40% in Nicaragua and Honduras alone. Roya is decreasing income levels for Central American coffee producers and Small Enterprises (SEs) posing a real threat for its financial stability and survival. With renovation costs estimated between US$600 to US$3,000 and a timeframe of 3-4 years before newly planted coffee trees start producing beans, there is an urgent need to provide a well-rounded solution that incorporates long term financing, a solution that is not currently provided by the formal financial sector. ECOM is a solid player that has been in the coffee business for decades, dealing directly with farmers and providing short term loans at flexible terms to better match the seasonality of the business. MIF would be providing technical assistance to improve the credit processing capabilities of ECOM/Atlantic.