IDH Farmfit Fund and Oikocredit provide a USD 3.5m loan to Aldea Global microfinance institution, a farmer-based organisation in Nicaragua
The investment will accelerate Aldea’s financial plan to grow its coffee and agroforestry loan portfolio, targeting financial support for approximately 9k coffee farmers by 2028.
Utrecht — 27 December 2024 — IDH Farmfit Fund and Oikocredit expand their commitment to Aldea Global S.A. by providing a syndicated loan to enhance smallholder farmer investments in coffee and agroforestry. Aldea, a farmer-based organization in Northern Nicaragua, supports smallholders with financial services, inputs, technical assistance, and coffee processing and marketing. This investment provides stable funding, strengthens Aldea’s debt structure, and enables long-term farmer loans, fostering resilience against climate change. Aldea has committed to adopting Cerise + SPTF Client Protection Principles and set a goal of serving at least 30% women borrowers.
After the financing of Aldea's coffee processing facility in 2021 , we are excited to expand our relationship through financing of Aldea’s Microfinance Institution, together with our partner Oikocredit. We see Aldea as a leader in its sector, with a very strong farmer focus, and we expect that, with this loan, Aldea can further increase its farmer reach and impact.
We are glad to build on the longstanding partnership between Aldea and Oikocredit that started in 2007 and build further on the warm ties and collaboration with IDH. This new long-term investment provides funding stability for Aldea so it can continue and expand the positive development impact to many farmers and the communities they are part of.
In Nicaragua, only about 10% of those aged 15 and older access money through formal financial institutions. To address this, Aldea Global is enhancing financial inclusion by providing smallholder farmers with working capital, input loans, and long-term agroforestry financing. Over the past three years, Aldea has increased its reach, supporting 18,000 smallholder farmers as of September 2024, with a target to serve 26,000 by 2028.
We are excited about this investment, as it strongly aligns with the Fund's mission to support the coffee sector, attracts additional funding in Nicaragua, and enhances farmers' incomes through productive credits. Farmers can also receive finance for long-term agroforestry projects to improve their environment. With this investment, we facilitate Aldea's quest to help more smallholder farmers achieve stable incomes and greater financial and climate resilience.
About Aldea Global S.A.
Aldea Global S.A. (“Aldea”) is a microfinance institution that has been financing productive loans to smallholder farmers in Nicaragua's north-central zone since 1992. These loans cover not only input credits and coffee production during the coffee processing period but also other crops, such as cocoa, maize, and horticulture.
Aldea and its sister companies (Aldea Coffee S.A. and AldeaZon S.A.) are socially responsible companies that offer their clients innovative products and services led by data, technology, and human quality. Aldea contributes to the economic development of smallholder farmers in the rural sector by providing services and solutions in the coffee value chain, leveraging their expertise to drive innovation and growth by offering inputs, credit, insurance, transport, and commercialization services to coffee producers, and non-financial products like technical assistance, soil testing, weather forecasting, and mobile apps. For more information, visit https://aglobal.org.ni/
About Oikocredit
Social impact investor and worldwide cooperative Oikocredit has nearly five decades of experience funding organisations active in financial inclusion, agriculture and renewable energy. Oikocredit’s loans, equity investments and capacity building aim to enable people on low incomes in Africa, Asia and Latin America to improve their living standards sustainably. Oikocredit finances more than 520 partners, with total outstanding capital of EUR 1,029.8 million (at September 2024). For more information, visit www.oikocredit.coop
About IDH Farmfit Fund
The IDH Farmfit Fund is a public-private impact fund for smallholder farmers, many of whom are amongst the poorest people in the world. The Fund can take the highest risk positions in smallholder farmer related transactions, thereby reducing the risk currently born by borrowers and lenders. By doing so, IDH Farmfit Fund aims to catalyse commercial capital to coinvest in this sector. These investments will increase the availability of affordable, long-term financing to smallholder farmers, allowing them to invest in their farms, increase productivity and adopt climate-smart agriculture best practices, leading to improvements in their livelihoods and incomes. The IDH Farmfit Fund is facilitated by IDH, The Sustainable Trade Initiative, and supported by a unique coalition of partners, including commercial banks, development banks, government bodies and value chain companies. For more information, visit IDH Farmfit Fund
In 2021, the IDH Farmfit Fund and Oikocredit provided financing to the former Aldea Global Association (now Aldea Coffee S.A.) for the construction and equipment of its dry coffee mill, enhancing coffee quality and productivity. As of May 24, the first phase of the mill is complete, and Aldea has grown its membership to 16,000 farmers despite challenges in the Nicaraguan coffee sector.