Colombia leads the way in greening agricultural finance to protect biodiversity

Bogotá, D.C | 19 March 2025 — Colombia is advancing in its efforts to transform its agricultural sector into a sustainable production model. This shift is driven by public and private sector collaboration, international cooperation, and increasingly, the financial sector's involvement.

A critical part of this transition is improving access to agricultural credit that considers ecosystems and the social and environmental realities of Colombia’s territories.

The Fund for the Financing of the Agricultural Sector (FINAGRO), in partnership with the United Nations Development Programme (UNDP), has launched a dialogue with experts and representatives from the financial and agricultural sectors. The focus: "green" agricultural loans for key value chains — cattle, cocoa, coffee, rice, cassava, and non-timber forest products.

This working group marks the first step toward transforming financing in these sectors, chosen for their strong territorial presence, ongoing research into sustainable practices, relevance in rural reform, and social, economic, and environmental significance.

Colombia is pioneering a global first — a reform pathway to redirect financial instruments that may negatively impact biodiversity. This initiative aligns with recommendations from UNDP’s BIOFIN study on harmful incentives in Colombia’s agricultural and rural development sectors.

Alongside Nepal and Kyrgyzstan, Colombia is leading action on Target 18 of the Kunming-Montreal Global Biodiversity Framework. This global target urges countries to identify and reform harmful incentives in production sectors by 2025 in a fair, effective, and equitable way.

Through the BIOFIN initiative, UNDP has facilitated institutional coordination to support this transformation. The greening of FINAGRO loans marks the first step in reshaping financial flows to encourage conservation and sustainable agricultural productivity, unlocking new opportunities for both farmers and biodiversity.

The ongoing meetings, aligned with the goals of Target 18, have created space for dialogue around the proposed methodology for green loans. They account for Colombia’s social, economic, and environmental diversity, the realities of agricultural production, and the existing supply and demand for financial services. The goal is to ensure a feasible, effective shift to sustainable production models.

The process has also generated strategic recommendations for the National Agricultural Credit Commission. These include elements for transitioning to green credit, such as prioritization criteria, sustainable production practices, and incorporating an ecosystem-based financial analysis.

Key insights from the discussions include:

• The greening of loans must reflect the territorial and ecosystem diversity of financial service coverage.
• For the transition to succeed, market demand for sustainable goods and services must align with credit conditions. Farmers must see positive returns from their investments in sustainable practices.
• The leadership of agricultural associations, the country’s research experience, existing sustainability certifications, and learnings from existing green credit lines are essential to defining the right credit mechanisms and setting impact indicators.