The Margarita Loan Guarantee Fund: Building a blended finance mechanism for small-scale dairy farmers in Mexico

The Margarita program—a public-private partnership that has worked with more than 900 farmers with the aim of integrating small-scale dairy producers into an inclusive and stable supply chain— created an innovative and comprehensive solution.

For millions of smallholder farmers around the world, limited access to finance represents a major obstacle to participating in formal supply chains and investing in regenerative practices. This was the case for many dairy farmers in the states of Jalisco, Aguascalientes and Zacatecas, Mexico, with negative consequences for the profitability and resilience of their farms.

To address this challenge, the Margarita program created an innovative and comprehensive solution. An investment of 10 million pesos in the mechanism has mobilized close to 150 million pesos in loans for milk producers over ten years.