Increasing availability and access to credit facilities for smallholder coffee farmers in Kenya within supply chain
Vava Coffee, a Kenya-based social enterprise, has joined the Business Call to Action with a commitment to extend a credit facility complemented by financial management and sustainable agricultural practices training to 130,000 coffee farmers in the country by 2018.
Founded in 2009, Vava's domestic and international market shares are set to increase significantly over the next five years, resulting in increased demand for coffee beans from the company's supply chain. Without access to affordable and flexible credit facilities, the company's smallholder suppliers will be unable to scale up their coffee bean production to meet the increased demand. The credit facility will use a revolving-fund model to enable purchase of organic inputs and agricultural services. This will ensure both sustainability and increased yields of good-quality coffee, and enable the company and the coffee farmers to grow.
While coffee is Kenya's third most valuable export, Kenya does not have a strong coffee culture. However, coffee consumption is growing year by year, especially among Kenyan trendsetters who want to be associated with the latest styles. Domestically, the company is introducing its products to specialty stores, corporations, duty-free shops, supermarkets, airlines, hotels, lodges and fair trade companies. It is also striving to establish a foothold on the export market: the company currently has shipments underway to the Netherlands, Norwegian and North American markets.
As the only fully Kenyan-owned coffee company in East Africa, Vava has positioned its blends in the higher-end price range. Since 2009, the company has achieved global recognition for its premium coffees which include medium, medium-dark and dark roast, and Italian espresso as well as for its social impact.
Future plans call for partnering with larger financial institutions to reduce risk and expand the company's value chain beyond Kenya's borders. The company is also planning to offer health insurance as part of the credit facility.