Lesson Learned: Quality Pays - Mali
This note discusses USAID-funded TradeMali village warehouse credit scheme that assists farmers to collectively improve livelihoods. Chemonics International implements the CARE/Mali project.
Describing TradeMali's operations, the note explains that an operation of TradeMali, Credit Stockage Vivrier (CSV):
- Helps the farmers set aside a portion of their harvest as collateral;
- Enables them to store harvest till market prices rise;
- Ensures that they obtain credit, based on their stores, and earn profits, thereby helping in:
- Poverty reduction;
- Development of Mali's agricultural sector.
The note states that TradeMali:
- Requires participating farmers to regroup into a CSV village association;
- Provides a technician to work closely with the association;
- Shares the management of the warehouse with the financial institution;
- Uses the combined stored rice of the CSV village association to serve as guarantee by solidarity.
Further, the note highlights the achievement of TradeMali in extending finance to 207 producers and helping the association make a 25% profit. It describes a particular instance of failure of an association due to:
- Stocking of low quality, non-homogenized rice;
- Commercialization of rice by members;
- Negative effect on prices due to low quality stock.
Finally, the author asserts that this scheme has contributed positively to the lives of Mali farmers by educating them on principles of free market and by helping them make profits through collective investments.
