Creating Value Chain Finance Options for Ukrainian Credit Unions2022-06-09
World Council's Credit for Agriculture Producers (CAP) Project in May completed the first phase of an initiative to connect credit unions with select value chains, despite a temporary disruption in activities caused by the Russian invasion of Ukraine.
Experts began individual work with four pilot credit unions on value chain financing in January, conducting research in four oblasts of Ukraine, including:
With Russia's full-scale war starting in February and the temporary occupation of Kherson following soon afterward, the initiative had to be put on hold until April.
When work slowly resumed, experts were ultimately able to close phase one after:
- summarizing research results and sharing recommendations for the introduction of value chain finance with interested credit unions.
- providing three pilot credit unions with detailed information on the list of potential Ukrainian anchor companies, and proposals for building cooperation with local agribusinesses to tap into new or existing value chains.
In the next phase, pilot credit unions will independently prioritize value chains. With assistance from CAP, they will also hold negotiations with agribusiness representatives for developing tailored loan products and develop a sample multilateral agreement to introduce such loan products.