Supporting smallholder families, promoting innovation

How can companies and cooperatives promote sustainability in the coffee sector? The Coffee Innovation Fund, financed by the German Federal Ministry for Economic Cooperation and Development (BMZ), supported pioneering projects that make coffee cultivation more profitable for farmers in innovative ways. Using a wide variety of approaches, they improved production, processing or marketing of the beans and create more value locally. Criteria such as innovation, replicability, inclusivity and potential impact played a role in the selection of proposals. Subsequently, the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH supported the companies and cooperatives in designing and implementing their projects. In addition to financial support, they all received access to a broad network in the coffee industry. 

There were no limits to creativity: to compensate for low and fluctuating prices in the coffee sector, coffee farmers were supported in diversifying their income from several products such as honey, cascara and patchouli, which can be produced together with coffee. The utilization of bunk beds allowed effective use of space to dry coffee while growing vegetables. Digital tool recorded the CO2 storage capacity of coffee forests and promoted their protection or provided needs-based advice on appropriate land use to small holder farmers. A mobile pulping station also enabled farmers in remote, rural areas to sell their coffee at a higher value. Additionally, digital databases and blockchain-based traceability systems promoted transparency, market access, and networking opportunities among cooperatives and smallholder families. 

After a successful first round with 21 projects funded in Ethiopia, Myanmar, Indonesia and Vietnam, the Coffee Innovation Fund continued in a second round. In 2021, 20 selected projects started their implementation phase in the four East African countries Ethiopia, Kenya, Rwanda and Uganda, of which 18 were completed at the end of September 2022. An additional 13 projects running from March 2022 until July 2023 were launched in Kenya, Rwanda and Uganda

The funding enabled start-ups and cooperatives to test new ideas and gain experience. Other stakeholders are also able to leverage these experiences: through exchanges at events; factsheets that briefly and concisely summarize the projects; and a handbook with the solutions that were implemented in the projects. In this way, innovations from these countries are shared with the entire coffee world so that others can learn and benefit from them. 


What else you should know about the Coffee Innovation Fund: 

  • It supports the development and implementation of innovative practices, systems and tools in the coffee sector 
  • is a collaboration between one or more private companies and GIZ 
  • provides commercial benefits for the private partners while bringing developmental benefits to the coffee sector in the country 
  • is designed by both partners, but implemented by the private partner with third-party support 
  • can contribute up to €50,000 per project to cover the cost of materials, technology and technical assistance 
  • is not a cash-based fund and 
  • requires matching contributions from applicants (contributions can be in kind). 


The Coffee Innovation Fund was implemented by the Initiative for Sustainable Agricultural Supply Chains of the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH. GIZ worked with the companies to support them in designing and implementing the projects. 


Results achieved after four years of the Coffee Innovation Fund: 

  • A total of 53 demand-based projects were piloted together with various small-scale private businesses in 7 partner countries  
  • Implemented projects cover a wide range of topics: gender, income diversification, digitalisation, climate change mitigation and adaptation, biodiversity, deforestation-free supply chains, market access 
  • Enabled companies to pilot new products/processes, gain implementation experience and gain visibility 
  • Approx. 60,000 smallholders were directly involved in the implementation of projects 
  • Budget realised: 4.6 million Euros 


Round 2.2 03/2022 - 07/2023

Capacity enhancement for Coffee Decker production

BigData for sustainable production and market access

Innovative farming for sustainable coffee production

Coffee Development tool to accelerate coffee based agro-forestry among coffee farmers


Launch of AnaerobicMaceration Coffee Processing to increase price premiums to coffee farmers.

Coffee based tourism development

Strengthening the smallholder-based coffee supply chain in Cyato through improved parabolic drying and compost-based farming


Soil Fertility & Coffee Quality Improvement through sustainable advisory services

Integration of Agripay Digital Network within the Coffee Value chain for Enhanced Market Access

Strengtheningtechnological & agro-enterprise capacity of small holder coffee farmers

The Eva’s Coffee Eco Lodge

Coffee value chain automation, capacity, and efficiency enhancement

Round 2.1 03/2021 - 09/2022

Digital applications to facilitate market access for smallholders

Artificial intelligence for early detection of coffee diseases

Results-based carbon payments for Ethiopian coffee agroforestry

Organic Cascara production to increase the living income

Value addition service centers for smallholders and entrepreneurs


Biogas technologies for clean energy and organic manure

Integration of beekeeping into the banana coffee system

Mobile coffee pulping

Rainwater harvesting for wet coffee processing

Transparent reporting system for coffee


Brand building and direct marketing campaign - fully made by women

Coffee and Patchouli intercropping for increased coffee production and quality

Digitized coffee supply chain for improved quality, management, sourcing, and sustainability

Rwandan coffee value chain directory for direct crop to cup linkages

Organic fertilizer production to increase productivity and quality


Digitizing the Nairobi Coffee Exchange

Diversifying coffee farm income through modern bee farming

Expanding eco-friendly domestic consumption to increase farmer incomes

Maximizing the benefits of sustainable wastewater management

Repairing soils to increase quantity and quality coffee yields

Round 1 06/2019 - 10/2020

Consumer microloans on blockchain for coffee farmers

Enabling living income through consumer empowerment

Mechanical coffee drying machine that utilises coffee waste to dry coffee faster

Developing digital solutions


Developing instant speciality coffee for the global market

Improving fermentation to create new taste profiles and boost cupping score

Indonesian Coffee Flavor Wheel

Farm facilities model for speciality coffee processing

Digital traceability to ensure coffee quality

Developing Agni-Dryer for natural coffee processing

Digital traceability platform for a sustainable specialty coffee value chain

Connecting coffee growers and drinkers to make coffee more sustainable


Speciality Arabica coffee and eco-tourism

Innovative bunk beds with drying tables and garden beds

Solar drying dome system

Virtual learning for coffee stakeholders


Solar dryer domes for better quality and profitability

Improved Flavour Spectrum for Catimor Arabica

Better Market Access for Highland Speciality Coffee

Mobile soil testing for optimising fertilizer use

Business Model for Organic Fertiliser Production


Consumer microloans on blockchain for coffee farmers

Digital bookkeeping for coffee producers

Enhancing consumer engagement and revenue to coffee farmers

Green bean coffee husk-powered mechanical dryer


Adena Kenawat Agni-dryer

BUMI digital traceability

Kiwari Specialty Instant Coffee

Marketing traceable coffee at the register

Origin centered coffee traceability

Seniman Coffee - Coffee Flavor Wheel App

So so good coffee company

Tanamera Specialty Processing Model


Behind the Leaf Bunk Beds

Jadae Akha Coffee Group Business

MM Coffee Academy by PSedx

United Power Solar Dome Drying


Bosgaurus Improved Flavor Spectrum

Buon Ma Thuot Coffee Association

Khe Sanh Cooperative Organice Fertilizer

Sau Nhung Solar Drying Coffee

SMS Mobile Soil Testing