In a significant step to bring producers of sustainable value chains in the Amazon closer to the formal financial market, the Amazon Business Alliance is providing technical support to the Peruvian Federation of Municipal Savings and Loan Associations (FEPCMAC) to launch an innovative Biocredit. This is the first sustainable agriculture financial product for the Peruvian Amazon aligned with the Bio-business criteria established by the Ministry of the Environment and will be executed by the Municipal Savings and Credit Banks (CMAC).
The Biocredit is aimed at natural or legal persons engaged in sustainable agriculture in the Peruvian Amazon, taking into account environmental, social and economic requirements. In this sense, this financial product incorporates environmental eligibility criteria that guarantee the conservation of the Amazon forests and the sustainable use of resources, such as: cultivation in areas free of deforestation, not affecting protected natural areas, application of agroforestry practices, integrated pest management, use of organic fertilizers. This pilot plan represents an important milestone in the promotion of sustainable agricultural practices and the conservation of the Peruvian Amazon.
In this regard, it is of particular interest to the Alliance to contribute to boosting impact investments, which seek to achieve social and environmental benefits, in addition to obtaining a financial return. In addition, financial inclusion is an indispensable tool for sustainable development in the Amazon regions, where it is still very limited, so addressing this gap is key.
In an innovative effort to address this lack of access and develop specific financial products for producers with good environmental practices, the Amazon Business Alliance, a platform led by the United States Agency for International Development (USAID), the Government of Canada and Conservation International Peru, in conjunction with FEPCMAC, has developed the design of the Biocredit following the key milestones described in the Ministry of Environment’s green finance roadmap.
