The credit investment into agricultural financing firm Samunnati aims to economically support farmers while facilitating climate-positive practices.
Swiss-based impact investor Blue Earth Capital is providing a loan of $16m (€14.9m) to Samunnati, an agriculture financing firm headquartered in Chennai, India which supports smallholder farmers in the country, while teaching them climate-smart farming practices.
Speaking to Impact Investor, Amy Wang, head of private credit at Blue Earth Capital, said the deal with Samunnati reflects her firm’s growing belief that social and environmental issues are interconnected.
“By making this deal we knew we were engaging in something which will bring economic and social benefit to the smallholders who are often financially impoverished, and in a way that is going to be climate positive,” said Wang.
Climate-smart farming
Agriculture is a critical pillar of the Indian economy, but it also remains a huge contributor to CO2 emissions.
Additionally, smallholders – those owning less than two hectares of land – who account for 86% of all farmers in India, are still some of the poorest people in the country, according to the World Economic Forum.
Samunnati works to solve these problems by providing financing, market linkages, and advisory services to more than 6,000 farmer collectives and 3,500 agricultural enterprises across 28 states in India, while also embedding sustainable farming practices.
“We were excited to see Samunnati had produced a product to scale which helps smallholders deal with a major pain point in their working capital cycles which is ensuring they get the best price for their product,” Wang said.
Blue Earth Capital was founded in 2015 by Urs Wietlisbach, a co-founder of Partners Group, and is owned by his Blue Earth Foundation, a Swiss-based non-profit whose initiatives and business ventures aim to deliver a more equitable and sustainable future.
Anil Kumar, Samunnati CEO and founder, said: “This credit facility will significantly bolster our resolve to amplify our efforts, empowering all stakeholders in the agricultural value chain and ultimately transforming the lives of smallholder farmers across India”.
