Program:          World Council of Credit Unions (WOCCU),

Credit for Agriculture Producers Project (CAP) in Ukraine

Location:         Ukraine

Timeframe:     May - August 2021

Submission Deadline:  April 23, 2021

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Description of Services:

World Council of Credit Unions (WOCCU) is seeking a short-term consultant to develop the methodology for lending to agriculture producers for the purchase of agricultural land in Ukraine through credit unions.

Background: 

The Credit for Agriculture Producers (CAP) project, funded by USAID and implemented by WOCCU, seeks to revitalize the credit union sector in Ukraine by creating a more transparent legal and regulatory framework for credit union operations in Ukraine to both promote growth and reduce risks, while improving access to agricultural finance for agricultural and rural micro, small, and medium enterprises through credit unions. The CAP project completed its initial four years in August 2020, and received a cost extension through March 2023. Specifically, during the cost extension, the project is expected to: (1) strengthen credit union regulator and national associations’ capacity; (2) advocate for an improved and updated legislative framework to meet European Union (EU) standards, enabling credit unions to compete with other financial institutions; and (3) address constraints preventing credit unions from expanding outreach and delivering high-quality lending to the agricultural sector.

To achieve these results, project activities are linked to four key objectives:

• Objective 1: Credit unions operate in an improved enabling environment.
• Objective 2: National credit union associations offer improved services to credit unions.
• Objective 3: Credit unions have increased liquidity.
• Objective 4: Credit unions expand their agriculture finance portfolio.

Overview of Scope of Work: 

The opening of the land market in Ukraine is scheduled for July 1, 2021, and credit unions want to be active participants and be able to provide loans to their members to purchase agricultural land. In this regard, under Objective 4, CAP conducted a survey among credit unions and their member agricultural producers. The survey results demonstrated the demand from agricultural producers for finance of land purchase and the willingness of credit unions to provide such financing. In this regard, credit unions need technical assistance to implement the program of lending for the agricultural land purchase. Following the survey, CAP formed a “Land Market Purchase” subgroup of credit unions participating in the Agriculture Lending Working Group (AGLWG) which were interested in developing land market-related products.

Through this consultancy, the consultant will analyze, summarize and present information to credit union representatives to improve their knowledge regarding the specifics of lending for land purchase both through a series of webinars and a printed manual. This will include ensuring that credit unions are aware of all the possible threats and opportunities of lending for the purchase of agricultural land.

Specific tasks of the consultancy include:

1.    Developing and holding an introductory webinar for credit unions:

• General overview of current legislation on land reform.
• Possibles ways to acquire ownership of agricultural land after the lifting of moratorium.
• Lease and sublease agreements.
• Estimating the value of land lots.
• State support programs, compensation of rates.
• Legal and organizational risks of credit unions in land transactions.
• Sanitary and other legal requirements to combat COVID-19 that should be considered with respect to the land purchase and credit processes.

2.    Developing a Manual to help credit unions implement a lending program for agricultural producers for the purchase of agricultural land. This Manual should contain an overview of current legislation; standard texts of lending documents and recommendations for their completion; and the systemization of the following methods:

2.1. Land plot verification methods.

Registration of a land plot and its ownership rights. Land plot attributes and information about the subjects of property rights. Sources and methods of information verification.

2.2. Methods for estimating the value of agricultural land.

Regulatory value of land. Market value. Liquidity of the land plot. Analysis of the potential cost of the plot. Assessment of advantages and disadvantages of the land plot with respect to valuing the land.

2.3. Borrower assessment methods.

Compliance with the purchaser’s criteria. Prerogative right. Determining the area of land. Action plan for credit unions to conclude land-related agreements. Collateral for a loan for land purchase.

2.4. Risk assessment methods.

Recommendations for avoiding legal and organizational risks in credit unions during land transactions.

3.    Holding a series of webinars for credit unions and their members:

• Topics to include an overview of the manual and changes in legislation.
• Topics to be determined and addressed according to the needs of credit unions and their members (group consultations, answers to questions).

Expected Outputs/Deliverables: 

• Introductory webinar for credit unions developed and held.
• Manual “Lending to agricultural producers for the purchase of agricultural land” designed and shared among credit unions.
• Webinars for credit unions and their members prepared and held.

Application Instructions: 

Please submit your proposals to [email protected], with the subject line “Agriculture producers lending methodology development.” Proposals should include the following information:

• CV/Background information for firm or individual
• Cover letter, including 2-3 references, detailing:
  • Higher education in law, economics, land management, agricultural finance.
  • Experience in conducting similar work related of land management in agricultural company or consulting of land ownership and land rent in law company.
• Proposed schedule/timeline of services (estimated level of effort for the assignment is business days, pending work plan developed in coordination with the selected consultant). It must be broken down on all three tasks: 1. Introductory webinar, 2. Manual, 3. Webinars for credit unions and their members.
• High-level budget for proposed services, broken down in the following areas: Personnel and Fringe Benefits, Other Direct Costs, Indirect Costs and separated on three tasks (1. Introductory webinar, 2. Manual, 3. Webinars for credit unions and their members).

Both firms and individual consultants are welcome to apply.

Application Period 

Proposals will be accepted until April 23, 2021, 5PM (Kyiv time).

Disclaimer

This bid solicitation in no way obligates World Council of Credit Unions to award a contract, nor does it commit World Council of Credit Unions to pay any costs incurred in the preparation and submission of the application. World Council of Credit Unions reserves the right to vary any part of this bid solicitation at the time of award if it becomes necessary.