Access to finance allows smallholder farmers to purchase improved inputs and services, giving them the chance to graduate from subsistence farming and move up the productivity chain.
The LIFT programme in Ethiopia applies the market systems approach to a land certification programme. The key constraints identified that prevent smallholder farmers from benefiting from and participating in this market include limited access to formal sources of credit and inability to collateralise their main asset – land.
Development of a second level land certification (SLLC) -linked individual agricultural loan product was designed to address the underlying constraints that exist in the access to finance market system. This has allowed micro-finance institutions to both offer higher loan amounts to farmers and attract clients who previously did not access formal credit.
Land Investment for Transformation (LIFT) aims to improve the incomes of the rural poor, especially women and youth, as well as enhance economic growth by focusing on second level land certification; improved rural land administration; improving farmers’ access to rural markets (land rental, access to finance and agriculture).