Impact Banking helps ‘smallholder farmers’ to improve

Around the world some 500 million ‘smallholder farmers’ struggle to get by. Many of them do business, directly or indirectly, with large commodities companies that are clients of ABN AMRO. To help them, the bank has joined forces with clients and non-profit organisations to provide loans to this vulnerable group.

ABN AMRO first introduced its Impact Banking programme four years ago: providing loans (through its clients) to smallholder farmers in developing countries. This enables those farmers to buy the things they need such as fertiliser or seedlings for other crops, to improve their production and, consequently, their standard of living. The farmers also receive training on land cultivation, sustainable farming and careful use of money. 

“Smallholder farmers often fall victim to local brokers,” explains Liesbeth Kamphuis, Senior Director of Impact Banking. “They just know when a farmer needs money and they use their local dominance to demand interest rates in excess of fifty percent. So we work with our clients, major commodities traders that do business with those farmers, to create positive change.”

“Thanks to our loans,” Liesbeth continues, “farmers can improve their production without resorting to slavery or child labour. That’s also good for our clients in the commodities trade: they want the supply chain to be socially responsible, too.” 

Positive impact

ABN AMRO defines a smallholder farmer as someone who works alone or with only a few helpers on less than 1.5 hectares of land. Most of them are found in developing countries in Africa, Asia and Latin America. Since 2015, ABN AMRO has earmarked 50 million euros for Impact Banking; in September 2019 it had lent 11.5 million euros to a total of 9,000 farmers across three projects.

“Things aren’t going as fast as we’d like,” admits Liesbeth. “There’s a reason for that, though. We’re quite strict about who we choose to finance, because we don’t want to lend money to just anyone. We need to be very certain about our positive impact on farmers’ lives.”

Since October, the Impact Banking team has also started working with ABN AMRO’s Sustainable Finance Desk. They use financial solutions to improve the sustainability of the supply chain in the agri and food industry, acting through medium-sized companies.


A fourth project was recently introduced alongside the three existing projects: a partnership with Rabobank, BNP Paribas and Germany’s Neumann Kaffee Gruppe, one of the largest coffee producers worldwide, has agreed to lend a total of 25 million euros to coffee farmers in twelve different countries. This makes it one of the largest of all Impact Banking projects. 

“We expect that in due course we’ll be able to help 300,000 farmers,” comments Miles Ashton, one of ABN AMRO’s Impact Bankers. Miles explains that the decision was based in part on the successes in Uganda, where progress is being made and the farmers are managing to repay their loans without difficulty. “These kinds of projects are only possible with partnerships. You need engaged clients who are passionate about improving their supply chain. Our clients in the commodities market are showing an exciting level of innovation, for example by developing apps to make it easier to train and communicate with smallholder farmers.”


ABN AMRO wants to do more than simply provide favourable loans. Local service centres are being set up in the various countries where farmers can attend classes. Miles continues, “Many of the farmers have limited knowledge on cultivating their land: when and how to prune their crops to maximise production, for example. We also teach financial skills: for example, explaining the concept of a loan, paying back money that you’ve borrowed is new to some of them. And when is it wise to take out a loan? How do you determine whether the terms are fair? These lessons will eventually improve the quality of the supply chain from top to bottom.”