The Co-operative Bank has continued to support the agricultural sector and specifically farmers in all corners of the country. This is evident at the ASK Mombasa International Trade Fair where the bank is showcasing its deep presence in the Coast Region, supporting farmers especially those organized in Co-operatives and producer groups. In partnership with both local and international partners, Co-op Bank is making tremendous progress reviving and expanding the incomes of farmers in the coast region, as may be seen in these select cases;
Kwale Pavi Cotton Program
PAVI Farmers’ Co-operative Society in Kwale was started as an initiative of Base Titanium Ltd for farmers who grow cotton, sorghum, potatoes and poultry. Through close support and collaboration with Base Titanium Ltd, the smallholder cotton farmers who previously had given up hope in their crop have been linked to mainstream international markets, enabling the farmers earn greatly improved returns for their cotton, as high as Kes 198 per kg of cotton lint as opposed to Kes 138 per kg of cotton lint offered by local ginneries.
The most notable foreign buyer of cotton from small-holder Kenyan farmers is CottonOn Corporation, which is the largest Australian cloth and fashion design group started in 1991 and which has since expanded to become a global player with 1,400 stores across 7 brands and 19 countries. It is also one of Australia’s leading global fashion brands.
Co-operative Bank has supported this cotton program with a Supply Chain Credit Facility of US$ 1 Million to ensure farmers are paid promptly upon harvesting and delivery of their cotton to the Co-operative Society. The bank financing has greatly motivated farmers to remain committed to the program by reducing the previous delays in receiving crop proceeds due to the long cash cycle of the cotton business. By making funding available in a timely fashion, Co-op Bank has enabled the farmers to continue with farm preparation for the next season as well as meet their other financial needs.
Lake Kenyatta Farmers’ Co-operative Society
This is a farmers co-operative society based in Lamu (Mpeketoni). Co-op Bank is offering financial support to these farmers through the same credit line with PAVI where PAVI is now able to purchase cotton from Lake Kenyatta for onward ginning and selling of the lint through the PAVI partnership with CottonOn Group. This is a major breakthrough as we have fostered a Co-operative-to-Co-operative trading partnership thereby locking away the brokers and enabling the farmers to earn much better returns on their produce.
This is a sisal producing company in Kilifi. The bank has supported them with asset financing to mechanize the production of sisal in the farm thereby enabling them enjoy substantial savings on production costs.
Co-op Bank that is predominantly-owned by the 15 million-member co-operative movement will sustain and deepen its presence in the Coast Region to continue supporting the banking needs of co-operatives, SMEs and public sector institutions including County Governments.
February 17, 2020