The FIG’s guarantees

therese-kanlinsou

Access to credit is essential for agricultural cooperatives and microfinance institutions for the needs of their members and to finance investments such as the purchase of agricultural equipment or the implementation of new projects. However, they face huge difficulties when approaching local banks who demand solid collateral.

The FIG addresses this problem by helping organizations who have the potential to develop and entertain clearly defined social goals. By granting them bank guarantees, the FIG allows them to increase their creditworthiness with the banks and thus obtain loans.

The FIG’s guarantees never cover more than 50 % of the loan granted to the beneficiary. Furthermore, the beneficiary has to become a member of the FIG by acquiring partnership shares for at least 5 % of the amount of the emitted guarantee. In case of non-payment, this amount is the first to be used to cover the call of the guarantee. In this way, all of the stakeholders share the risk of the credit operation and are instrumental to its success.

As our partners repay their loans, the conditions negotiated with the banks improve until the day they are considered reliable customers.

For more details on the conditions to obtain a guarantee, please contact our Secretariat in Geneva.