Access to financial resources is essential for promoting deforestation-free supply chains and enhancing transparency. Small-scale farmers, in particular, need support to implement sustainable land use practices and to adopt new technologies that national and international markets require, like traceability systems. Barriers such as high investment risks, operational costs, and insufficient or non-existent collateral limit their ability to adopt key sustainability practices.
Blended finance, which combines public/philanthropic and private capital, can help bridge this gap. By facilitating smallholders’ access to finance, blended finance can support the adoption of sustainable and deforestation-free agricultural practices.
The 4th SAFE Finance Briefing highlights explores the concept of blended finance, the key stakeholders involved and its potential to support smallholders. It also outlines pathways for smallholders to access such financing and highlights successful blended finance case studies, particularly those covering commodities included in the EU Deforestation Regulation (EUDR).
