Irrigation System Microleasing for High-Value Crops | Climate Finance, Uganda 2018
SEED Practitioner Labs Climate Finance in Uganda engaged financial institutions, funders, intermediaries and other SME ecosystem stakeholders over a multi-step process to co-create innovative climate finance products and mechanisms that extend access to long-term financing opportunities for “missing middle” small and growing climate-smart enterprises that struggle to advance beyond the start-up stage and multiply their contributions to climate-smart and socially inclusive economies.
The irrigation system microleasing for high-value crops solution, developed by Swisscontact Uganda directs deal flow to climate-smart irrigation systems to improve productivity and climate resilience of small-scale agribusinesses. Solar-powered irrigation system deployment for climate change adaptation and productivity improvements depends on coordinated institutional arrangements, irrigation infrastructure and capacity-building measures. This solution:
- Offers low-risk microleasing with buy-back options that delivers irrigation systems and system financing via technology provider networks to align cash flows with climate-smart technologies and incentives for sustainable agriculture practices;
- Aligns technology payments with crop cycles through comprehensive climate-smart technology assessments and issues term-based payments aligned with crop cycles and agribusiness cash flows;
- Decentralised delivery of bundled agricultural inputs via tech suppliers for improved climate-resiliency and value crop production by small-scale agribusinesses;
- Incentivises financial institutions to finance adaptation technologies in their appraisals by vetting irrigation technologies prior to the lending process.