Agrifood value chain finance can expand opportunities for smallholders

Agrifood value chains (AVCs) in low- and middle-income countries (LMICs) have been expanding due to a range of factors, including income growth, urbanization, more market-oriented policies, globalization, and technological changes. Integrating smallholder farmers into those growing value chains, particularly for higher-value commodities, is an important path towards reducing poverty and generating employment opportunities, particularly for women and rural youth.

But participating in high-value agricultural markets presents major obstacles for smallholders. Many lack the financial resources to make the needed investments to join those value chains and to effectively manage the risks in trying new types of products or production methods.