| Overview : The UN Capital Development Fund (UNCDF) is the UN’s capital investment agency for the world’s 48 least developed countries. It creates new opportunities for poor people and their communities by increasing access to microfinance and investment capital. UNCDF focuses on Africa and the poorest countries of Asia, with a special commitment to countries emerging from conflict or crisis. It provides seed capital – grants and loans – and technical support to help financial service providers reach more poor households and small businesses, and local governments finance the capital investments that will improve poor people’s lives. Financial inclusion means universal access, at a reasonable cost, to a wide range of financial services, provided by a variety of sound and sustainable institutions. The range of financial services includes savings, credit, insurance, payments, local money transfers and international remittances. UNCDF with the financial support from Government of Denmark is implementing an Access to Finance (A2F) component of UNNATI Programme in the seven hilly districts of Mechi and Kosi corridor – Taplejung, Paanchthar, Ilam, Dhankuta, Terhathum, Bhojpur and Sankhuwasabha through National implementation modality (NIM) in partnership with Nepal Rastra Bank (NRB). This programme has been designed to basically enhance and improve agricultural sector in Nepal. The objective of UNNATI is “Promotion of sustainable inclusive growth that reduces poverty and raises living standards.” Within the context of UNATTI, the purpose of the A2F project is to support financial service providers to more effectively serve the agricultural value chain actors with appropriate financial products thereby enabling smallholder farmers and MSMEs to invest into their value chain activities leading to the sustained improvement in competitiveness of selected value chains. The A2F project interventions will have national impact with a specific focus given to the Eastern Development Region of Nepal. Further the activities of A2F should be, primarily, coordinated with the activities of “Commercialization of selected value chains” Component 1 – sub-component 1.1. A2F has created a Challenge Fund and selected 10 financial service providers (FSPs) through competitive process to finance the value chain actors. These FSPs have been expanding their outreach in the programme districts to provide financial services to the value chain actors. However, Agricultural Value Chain Financing (AVCF) is a relatively new concept in Nepal. Without the overall understanding of agriculture value chains and the specific financial needs of the value chain actors, banks and financial institutions (BFIs) will not be able to design and deliver customized financial products and services that will best match the smallholder farmers and MSMEs' financial needs. There is a need for financial institutions to understand the functioning and requirements of value chain actors including input suppliers, growers, traders, processors, transporters, wholesalers, retailers and final consumers. Banks and financial institutions need to understand the end markets, business enabling environments, linkages, supporting markets, value chain governance, firm and industry level upgrading requirements, etc. By systematically approaching the value chain as a single unit, financial institutions will be able to develop and deliver appropriate financial products which in turn will contribute to the increase in access and use of such products by smallholders and MSMEs; effective risk mitigation by encouraging new and leveraging pre-existing value chain relationships along with an additional area for business expansion and revenue generation for financial institutions. In order to improve knowledge of Banks and Financial Institutions with focus on its current implementing partners in the area of Agriculture Value Chain Finance (AVCF), UNNATI-A2F has developed training module "Training of Trainers (TOT)" for banks and Financial Institutions. In 2016, UNNATI-A2F had conducted a 5-day event of TOT for the staff of Project (sub component 1.1 & 1.2), selected Banks and Financial Institutions. Since, in 2017 Performance Based Agreements (PBAs) have been signed for the implementation of agricultural financing projects, consultations with these partners revealed that there is is growing interest and demand from top management, middle management and credit officers of financial institutions for the training on Agricultural Value Chain Finance(AVCF). Thus, UNNATI-A2F project intends to deliver the training as per the training module developed by the project and this TOR has been developed to hire a team of consultant trainers. |
