Helping Horticulture Sector Buyers Access Finance

In Siem Reap province, the 37 members of the Banteay Srey Safe Agricultural Cooperative grow primarily cashew nut and mango on 200 hectares of land. Mr. An Som Ol, the agricultural cooperative (AC) committee leader, says one of the group’s main constraints to increasing its sales is working capital investment. “I want to borrow ten thousand dollars to collect cashew from our members and other producers, as well as expand our production to other crops, but I don’t know how,” he said.

Lack of finance has limited Cambodia’s horticulture sector actors—especially buyers of horticulture products—from expanding their businesses and increasing their sales. Many actors don’t know how to access appropriate services. For those that do know, they may still need a facilitator to help them identify the best financial products or prepare loan applications.

Harvest II staff met with Banteay Srey Safe Agricultural Cooperative committee members to discuss their constraints.

©Feed the Future Cambodia Harvest II/2018/Solina Kong

Feed the Future Cambodia Harvest II (“Harvest II”) is helping horticulture sector actors address financing constraints and seek lending options from financial institutions. Harvest II linked Banteay Srey Safe Agricultural Cooperative with Idemitsu Saison Microfinance, a Japanese micro-finance institution that provides financing for Cambodia’s agricultural sector. In discussions facilitated by Harvest II, Idemitsu Saison Microfinance agreed to disburse a $12,000 loan with a lower interest rate (1.3% per month, compared to 1.5% normally) and with no collateral requirement. As part of this facilitation, Harvest II conducted a short training for Banteay Srey Safe Agricultural Cooperative on how to prepare required documents, like financial statements, to apply for this and future loans.

“I could not have received this loan without Harvest II’s support,” Mr. Som Ol continued. This is the first time this AC has received a loan, and it will help them expand their business to buy more produce from internal and external members, as well as expand their crop production. With these additional resources, the committee has started discussing a production schedule that aligns to the needs of their customers in the wholesale market. They have started to plant mixed fruits and vegetables such as watermelon, chili, cucumber, and other leafy vegetable so that they can harvest – and earn money - year round.

Harvest II aims to accelerate growth of Cambodia’ commercial horticulture in Pursat, Battambang, Siem Reap, and Kampong Thom provinces. The project currently works with buyers and producers in the horticulture sector to establish or strengthen relationships, increase sales, boost investment, and create more jobs in the sector.