MICROCAPITAL BRIEF: FMO Announces $6m Loan for Microfinance Institution Sembrar Sartawi of Bolivia to Support Climate Resilience, Growth of Small-scale Farmers

Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden (FMO), a Dutch public-private partnership, recently announced a loan of USD 6 million to support Bolivia-based microfinance institution (MFI) Institución Financiera de Desarollo Sembrar Sartawi. The Dutch Fund for Climate and Development (DFCD), a private entity managed by FMO, will fund the facility, aiming to boost the “climate-resilient economic growth [of] vulnerable smallholder farmers” through microloans that support “purchasing environmentally certified seeds, investing in energy-efficient equipment, or taking out a climate risk insurance product.” In addition to providing financial support, Sembrar Sartawi will help small farmers improve their productivity through access to “professionals such as veterinarians and agricultural engineers.” Although the insurance partner for this project has not been identified, the MFI has a pre-existing relationship with La Vitalicia, a Bolivia-based company offering insurance for individuals and businesses as well as multi-family building developments.

Sembrar Sartawi is a Bolivian microfinance institution (MFI) that was established in 1989. The MFI aims to contribute to the development of micro- and small enterprises by providing financial services in underserved communities in both urban and rural areas. As of 2020, Sembrar Sartawi has four branches and 40 service agencies in Bolivia. As of December 2017, it reported a total portfolio of USD 55 million and 29,200 clients. More recent financial information from Sembrar Sartawi is not available.

Established in 1970, FMO is 51-percent held by the Dutch government and 49-percent by private investors. The institution works towards the UN’s Sustainable Development Goals by funding capacity development and placing debt and equity investments in sectors such as agribusiness, financial institutions and energy. During the year ending December 2020, FMO lost EUR 205 million (USD 245 million) on a total portfolio of EUR 12 billion (USD 14.3 billion).

By Harriet Ritchie, Research Associate

Sources and Additional Resources

FMO press release
https://www.fmo.nl/news-detail/a57ca906-5e2a-414a-82aa-b4ed431e0f12/increasing-the-climate-resilience-of-bolivian-smallholder-farmers

Sembrar Sartawi homepage
https://www.sembrarsartawi.org/

Sembrar Sartawi 2017 annual report
https://www.sembrarsartawi.org/#acerca

DFCD homepage
https://www.thedfcd.com

La Vitalicia homepage
https://lavitalicia.bo/

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