BDMG Regenerative Agriculture Fund Instrument Design Report

The BDMG Regenerative Agriculture Fund is a financial instrument designed by the Development Bank of Minas Gerais (BDMG) to support farmers in Minas Gerais, Brazil, in transitioning to regenerative agriculture (RA). Developed through the FiCS Innovation Lab with technical support from the Climate Policy Initiative (CPI) and other partners, the fund addresses barriers such as high risk perception, lack of technical knowledge, and limited access to affordable credit. The instrument employs a tri-partite structure combining credit guarantees, technical assistance, and a production support fund to mitigate the financial and productivity risks associated with the transition to RA.

• The RA Fund utilizes a three-pillar design to overcome barriers to regenerative agriculture adoption: a credit guarantee fund to increase access to affordable credit, technical assistance to bridge knowledge gaps, and a production support fund to cushion temporary income losses during the early transition stages.
• To promote gender equity, the fund's credit guarantee mechanism provides higher coverage for women, offering up to 100% coverage for credit lines to women compared to 80% for men.
• The instrument is designed for a pilot phase with an annual credit portfolio of BRL 10 million, averaging 20 operations with a ticket size of BRL 500,000. Post-pilot scaling aims to increase annual deployment to approximately BRL 50 million.
• The fund targets specific climate impacts, with a conservative estimate of 700 tons of CO2 sequestered in soil per year during the pilot phase. Long-term projections suggest that BRL 50 million disbursed annually could result in approximately 200,000 tCO2e sequestered over 10 years of recurring financing.
• Market research involving over 100 coffee producers revealed that while there is interest in regenerative practices, farmers face significant obstacles, including high collateral requirements and a lack of price premiums for regenerative products; only 26 of 105 surveyed coffee producers using RA had obtained higher prices.
• The fund's monitoring, reporting, and verification (MRV) framework uses a conservative approach focusing on the 0-30 cm soil depth, utilizing MapBiomas soil and land-use data and the Rural Environmental Registry for baseline Soil Organic Carbon (SOC) stocks.

APA

Esquinca, K. D. G., & Peres, T. (n.d.). BDMG Regenerative Agriculture Fund Instrument Design Report. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2009/02/BDMG-Regenerative-Agriculture-Fund.pdf

Chicago

Esquinca, Karla D. Gonzalez, and Taarika Peres. BDMG Regenerative Agriculture Fund Instrument Design Report. Climate Policy Initiative, n.d. https://www.climatepolicyinitiative.org/wp-content/uploads/2009/02/BDMG-Regenerative-Agriculture-Fund.pdf.

Wikipedia

{{cite report |last1=Esquinca |first1=Karla D. Gonzalez |last2=Peres |first2=Taarika |title=BDMG Regenerative Agriculture Fund Instrument Design Report |publisher=Climate Policy Initiative |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2009/02/BDMG-Regenerative-Agriculture-Fund.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{esquincandbdmg, author = {Esquinca, Karla D. Gonzalez and Peres, Taarika}, title = {{BDMG Regenerative Agriculture Fund Instrument Design Report}}, institution = {Climate Policy Initiative}, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2009/02/BDMG-Regenerative-Agriculture-Fund.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }