Global Development Co-operative (GDC)
The Global Development Co-operative (GDC) was launched in New York in November 2011 and aims to support co-operative businesses in developing countries by raising USD 50m to provide access to low cost loans for capital and infrastructure projects. It will target those with an interest in international development and extending the reach and benefits of the co-operative model. It will ensure that a positive and long-lasting legacy will remain from the International Year, helping thousands of co-operators in the developing world.
The International Year of Co-operatives recognised the role the co-operative business model has played in improving social and economic development in communities across the world by creating and sustaining jobs and reducing poverty. However, funding for such businesses is often scarce because traditional lenders are either not active in this market, do not sufficiently understand the co-operative business model, or because businesses have limited collateral to put forward.
The GDC has been developed by the UK’s The Co-operative Bank – part of the world’s largest consumer co-operative - and the ICA.
Amongst those who have already pledged their financial support for the initiative include the All China Federation of Supply and Marketing Co-operatives, Credit Cooperatif of France, SOK Corporation from Finland and IFFCO of India. Mid-Counties Co-operative as well as The Co- operative Bank from the UK who have also pledged their support.
The GDC will make loans available primarily to experienced intermediaries, with the following indicative spread across borrower categories:
Wholesale to established co-operative lenders (c50%)
Wholesale to existing secondary co-operatives / apex organisations,
Well-established but not necessarily currently lenders (c20%)
Direct to co-operative microfinance institutions and credit unions (c15%)
Direct to large, established co-operative businesses (c15%)
It will focus, not exclusively, on large co-operative sectors: agriculture, where co-operatives represent 50% of the world’s agricultural produce, and finance, where cooperatives serve 13% of the world’s population.
Target lending is US$50m at between 2% and 5% interest pa, with terms up to seven years. The interest will cover administration costs and a bad debt reserve. The key performance targets are social returns.
To get in touch with the Global Development Co-operative, click here.