Interview with Ana Terra Reis, Executive Director of FINAPOP
Jen: How was “FINAPOP” Created?
Ana: FINAPOP is the result of the motivation and organization of cooperatives established in Agrarian Reform settlements to seek financing and credit alternatives for the development of healthy food production, integrated into a strategy that includes the various links in the production chains, from inputs, through for production, agro-industrialization and commercialization of family farming products and Agrarian Reform. In 2020, FINAPOP was set as a movement, articulated by cooperatives and investors, with the aim of enabling access to financing and credit for settled family organizations, in a fair way, for the implementation of projects for the production of healthy food, in agrarian reform settlements throughout Brazil. Knowing the enormous challenge, we built the company FINAPOP Consultoria, founded in January 2022, with the commitment to articulate the will of people and entities to invest in projects that promote positive impacts on society and the environment. It went along with the need for access to financing for farmer organizations that have access to land and conditions to design a new way of producing healthy food, in a sustainable and fair way.Jen: How are your investment funds catalytic in a way that is different from other funds?
Ana: The FINAPOP fund is itself different from traditional finance, due to its investment objectives that are aimed at the development of cooperative and associative business plans, which are oriented towards the production of healthy food and territorial development with an increase in the income of the families involved, and the preservation of the environment, with cooperation and agroecology as guiding principles. A second example is its governance process that guarantees the qualification and monitoring of financed projects, with technical and political parameters, with a council made up of leaders who are co-responsible for the financed projects, ensuring the organizational principles that guide our operations, bringing security and transparency to each investor. The process of qualifying projects to be financed, which is carried out by FINAPOP, monitors and contributes to the preparation of business plans, ensuring technical, economic, environmental and social feasibility. The third, differentiating example are the guarantee policies applied by FINAPOP, where the food produced and the stocks of farmers’ organizations are the guarantee for contracts, enabling associations and cooperatives in agrarian reform areas (which are public lands and cannot be offered as guarantees) are able to access the loans.
Ana Terra Reis, Executive Director of FINAPOP
Jen: How do you describe the kind of non-financial returns the fund offers?
Ana: All cooperatives and associations that access resources from FINAPOP have the following principles:- Collective Organization of Peasants, Cooperation, Protagonism of Women and Young People
- Sustainability: economic, social and environmental
- Fair trade: promotion of local and regional circuits which are short,
- Production of healthy foods based on agroecology and the development of adapted technologies.
Jen: Can you describe how you use integrated capital to do your work?
Ana: We finance access to working capital, which removes middle-people and that increases margins by securing the raw materials and liquidity needed at planting. We also finance funding for new technologies such as organic fertilizers and defensives that provide better crop yields and quality, increasing margins and market recognition. Lastly, we finance investments in industrial capacity and technology that significantly reduce the need for manual labor, improving the lives of agricultural families. We do this from three investment lines:- CAPEX: Loans provided for capital investments aiming to increase productivity and enhance positioning in the value chain.
- Working Capital Loans: Loans for the purchase of raw materials by the industries at the peak of the harvest to increase their liquidity and margins.
- Seed Capital: Seed capital loans provided via the credit union associated with FINAPOP targeting small cooperative ventures
Jen: How do you address racial justice, income inequality, and/or gender justice through your products and services?
Ana: Inspired by the organizational principles of the Landless Workers’ Movement (MST) in Brazil, we have built our actions around strengthening territories born out of the struggle for land. These territories, formed through family organizations, are built on initiatives that create better living and working conditions and promote new social relationships. They are based on a new type of relationship with nature, a commitment to agroecological transition and the establishment of fairer human relations. For this reason, the family organizations that are part of FINAPOP carry out actions that address racial justice, gender relations and economic inequalities. They organize study groups, mixed leadership teams, carry out activities related to sexual diversity and fight to create conditions that encourage young people to stay in rural areas.
Jen: Can you share with us an example of an investment?
Ana: We funded the production of “Normandia Creole corn couscous” in the Agrarian Reform Settlement in Pernambuco.
- Association: ACANOR
- Number of families assisted: 20 families
- Amount invested: US$10,000.00
- Grace period of 4 months and another 4 months for payment.
- Interest rate: 6.5% per year.
- Strengthening agroecology, with heirloom corn cultivated from seeds that have not been genetically modified or exposed to chemicals.
- Preservation of seeds over generations by farmers, their guardians.
- Production of 20 tons of non-genetically modified couscous.
- Delivery of pesticide-free food for public school feeding programs.
- Improvement in economic income and quality of life for families.
- Consolidation of cooperation and organization among settled families, ensuring income, regional development, and strengthening of agroecology.
- Emphasis on experiences related to youth organization, women’s groups, and cooperation.
- Completion of the entire production process of heirloom corn, benefiting family production.
- Acquisition of raw materials directly from settled families, strengthening cooperative principles.
- Financial improvement for families by adding value to the product through processing heirloom corn and marketing flakes for couscous and bran.