Loan of 500,000 dollars helps 1,000 Peruvian coffee farmers take the next step

The social credit institute Oikocredit has issued a long-term loan of 0.5 million dollars to the Peruvian Sol & Café cooperative. This loan was given once the cooperative had met a number of professionalisation requirements set by Oikocredit. Agriterra provided assistance.

In cooperation with Agriterra, structural improvements were implemented, which resulted in the cooperative becoming 'bankable' and thus eligible for the loan. The 0.5 million dollars have been invested in the cooperative's drying and storage capacities. This has led to an increase in the price of coffee and generates a greater profit for the members.

The Sol & Café cooperative, which operates in the north of Peru,comprises more than 1,000 coffee farmers . It bulks the coffee produced by the members and processes it at the Norandino cooperative factory on the coast. Here are the results at a glance:

The Sol & Café cooperative has become bankable
Acquired a long-term loan of 0.5 million dollars
Increase in drying and storage capacities
Greater profit per member and a higher price per kilo of coffee

Structural improvements

Agriterra and Sol & Café worked together to implement improvements in order to meet the requirements set by Oikocredit. The points for improvement, which came to light following a business analysis, concerned financial management, the structure of the cooperative's equity and a boost in professionalisation on the part of the management. The cooperative made an increased effort with regards to the involvement of its members so that they are motivated to deliver their goods and to invest in the cooperative.

Professionalisation processes

The management also developed a system to sort the coffee into quality categories, meaning that the coffee can now be monitored throughout the entire process. Longer standing members of the cooperative were trained to become professional agricultural advisers, so they can provide their colleagues with better advice. This results in a higher yield and an increase in quality.

True coffee culture

The improvements have led to the establishment of a true coffee culture in which quality is the top priority. This enables the cooperative to continually supply outstanding coffee to the demanding markets of Europe and the United States. For Oikocredit, the improvements provided a good reason to grant the loan. There is now a system in place to sort the coffee, and Sol & Cafe oversees the entire process, from the procurement of the coffee to its storage and drying, right up to its transport and export.