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Building the bridge between responsible consumers and Fairtrade-certified farmers

Impact

Challenge

Fairtrade-certified farmer organizations usually buy the product from their members and then sell it to international clients willing to trade at Fairtrade conditions. 

However, they often face a liquidity gap: they do not have enough cash to pay their members directly on delivery of the product. And it can take weeks or even months before the payment from the customer is received. 

When smallholder farmers see that their organization cannot pay them when they bring the product, they prefer to sell it to local middlemen at the local market price (or below). 

They are therefore vulnerable to price volatility and receive no premium. Access to prefinancing during the harvest season enables Fairtrade-certified farmer organizations to buy more products from their members. 

This generates incremental and stable income to smallholder farmers and a Fairtrade premium that they can invest in the sustainable development of their communities. 

Achievements

Fair2C achieves its impact by prefinancing the production and export of Fairtrade certified products (with a focus on coffee for now). This way, farmer organizations can make additional sales under Fairtrade conditions.

Since 2021:

Support 18 farmer organizations regrouping over 19’000 small producers in Peru, Colombia, Guatemala, Honduras, Nicaragua and Ecuador

Gather CHF 1.1M in share capital and ensure its rotation, making it possible to provide financing solutions of over USD 12.8M

Create a community of over 86 cooperative members, both private persons and legal entities

Prefinance the production and export of 139 containers of Fairtrade coffee and cocoa

Contribution to SDGs

No Poverty Zero Hunger Gender Equality Decent Work Responsible Consumption

Who we've supported

 

Smallholder Farmers

Fair2C only offers financing to farmer organizations that are Fairtrade-certified. These are part of the portfolio of the impact investment firm FairCapital SA and have already received international financing. When necessary, Fair2C reiterates its support for the same organization year after year.