Getting access to finance is difficult for small entrepreneurs in developing countries. Without reliable access to the financial system, many developing country producers are struggling to participate in global trade.
In this blog post*, I will take a closer look at attempts to provide easier access to finance for fair trade producers. Organisations such as Shared Interest and Triodos Bank offer schemes which aim to provide direct loans to smaller producers. Separately, other potential innovations involving fair trade intermediated bonds or fair trade certification for futures contracts is also discussed.
Innovation in trade finance shouldn’t only be about providing easier access to capital for producers. Rather it is important to consider how financial markets can be adapted to be more inclusive of smaller entrepreneurs in developing countries.