UNCDF invested in its first food security financing project in Bangladesh.With the objectives of addressing micronutrient deficiency and to promote technology to reduce post-harvest losses as well as the establishment of modern processing and cold-storage facilities as advised by FAO, UNCDF has made a blended finance investment of grant and reimbursable grant in a social enterprise GUK Inclusive Enterprise Ltd.

UNCDF’s grant of $ 28,235 has unlocked bank loan of $19,118 and developer’s equity of $101,453; ratio of unlocking is 1:4. The investment has created employment opportunities for 5000 contractual farmers (3000 female and 2000 male) of biofortified Orange fleshed Sweet Potato (OFSP). UNCDF has also invested reimbursable grant of $45,294 to help create a credit history for the social enterprise to make them bankable for commercial loan in future.
A modern storage facility is being set up for storing OFSP within three days of processing from the field. For market promotion of the product, GUK is developing a market value chain by packaging, branding, marketing and distribution through establishing partnership with capital based Mega-shops/online marketing platform; arranging promotional activities like advertisement, mass campaign, nutrition fair etc. to disseminate the message focusing usefulness of OFSP; formation of farmers forum at village level; arranging court-yard meetings with farmers and arranging training for farmers on production of OFSP more efficiently engaging officials from govt. department.

This is a farmer-oriented initiative that will ensure the receiving of fair price for OFSP farmers and remove middlemen. Cost and investment of time of OFSP farmers will reduce by use of improved mechanization during farming, harvesting and post-harvesting. 5% of income from the project will be invested for training of the OFSP farmers so that existing system loss and/or unexpected damage is reduced during gardening, harvesting and post-harvesting. A regular selling hub will be established to prevent post-harvest loss and ensure timely marketing. A testing lab will be set up to ensure quality of crops.
Living standard of farmers is expected to be improved by better price they will receive. Estimated increase of income is 25%. OFSP has low glycemic index and possesses antioxidants; consumption of leaves and roots will minimize the risk of diabetes, cancer, and heart disease. Promotion of OFSP will reduce micronutrient deficiency in the community and population at large, particularly as low-cost option for children, pregnant and breastfeeding women, poor rural and urban households.

UNCDF has received 67 proposals for similar investments for transformative food security financing in Bangladesh.