Terms of Reference for Strengthening Risk Management, Financial Product Development and Fund Utilization of Farmer’s Cooperatives in Nepal

Terms of Reference for 

Strengthening Risk Management, Financial Product Development and Fund Utilization of Farmer’s Cooperatives in Nepal.

1. Background

Heifer Project International Nepal (Heifer) is committed to transforming rural communities by co-creating inclusive, thriving, resilient and sustainable food systems, with smallholder farmers at the center of change. Since 1997, Heifer has served more than 418,000 families, supporting their journey from subsistence to prosperity through community-driven agriculture and livestock initiatives.

By creating Self-help Groups and Social Entrepreneur Women’s Cooperatives (SEWCs), Heifer helps build resilient communities and sustainable livelihoods. With a holistic approach, Heifer collaborates with local governments and partners, engages youth to improve agricultural practices, supports women-led cooperatives, and creates lasting economic change. Its mission is to ensure families achieve sustainable living incomes while driving progress toward more inclusive and resilient agri-food systems.

SEWCs have played a pivotal role in mobilizing women in rural Nepal by promoting sustainable, income-generating activities. These cooperatives primarily engage in savings and credit services, along with livestock, dairy and vegetables, and other agro-based enterprises. However, the current national economic climate characterized by rising non-performing loans and weak credit demand has also affected the cooperatives, resulting in increased liquidity levels. Furthermore, most of the cooperatives have limited financial risk management systems and practices in place, highlighting the need for strengthened institutional and financial governance mechanisms. Heifer has planned to improve the financial performance of these cooperatives with a major focus on credit mobilization in the agricultural sector and simultaneously support them on credit risk management.

In this scenario, the objective of the assignment is to develop comprehensive financial product development and risk management guidelines for cooperatives engaged in savings and credit, and agribusiness activities. The guidelines will focus on strengthening financial risk management including repayment and recovery, promoting the proper utilization of funds and external loans, designing appropriate loan products for smallholder farmers, and enhancing overall financial performance and sustainability.

2. Objectives 

The overall objective of this assignment is to strengthen performance of SEWCs and other cooperatives by designing and implementing risk management mechanisms grounded on existing national and international mechanisms, with sincere consideration on saving and credit business diversification. Below are the specific objectives of this workshop:

• Enhance knowledge and skills of cooperatives on financial risk identification, assessment, management and implementation by validation of social capital as a de-risking mechanism for financing.
• Support cooperatives to design saving and lend products which would best fit the needs of members and reduce the financial risk by developing a guideline.
• Develop a comprehensive risk management guideline for cooperatives addressing multiple financial streams.
• Develop a guideline outlining legal and practical solutions for credit repayment and recovery.
• Design and execute an action/rollout plan to ensure effective orientation and application of developed guidelines.

3. Deliverables:

I. Inception report outlining the proposed methodology, workplan, timeline, and data collection tools.

II. Saving and lending product development guidelines incorporating cost-based, market-competitive and member centric approaches in line with cooperative business models.

III. Cooperative risk management guidelines including loan repayment and recovery, internal de-risking strategy, and governance structure.

IV. Roll out 2-day sharing events in two places to orient and adapt the guidelines as per need of cooperatives.

V. Final report including documents and guidelines developed during the assignment.

4. Tentative Methodology:

• Mapping of current national policies, guidelines, tools, procedures and key stakeholders working in this space.
• Broader literature reviews include good national and international practices.
• Understanding of relevant existing national and international mechanisms and building upon them develop more effective and appropriate mechanisms.
• Consultation with different levels of cooperatives to understand their practices, policies and risk management system.
• Develop standard guidelines and policies for product development and risk management.
• Disseminate and adapt those guidelines and policies in consultation with the cooperatives.
• Testing of developed guidelines in few selected cooperatives before finalization.

Note: In addition to other relevant national and international policies, guidelines, and resources, ensure the following are reviewed for example Agri – Lending Manual (Nepal), NEFSCUN Guidelines, Tools & Manuals, Agricultural Lending Toolbox, Value Chain Finance Technical Guide, Agriculture Value Chain Finance Manual etc.

5. Duration

The assignment is expected to take 60 days (about two months), over a two and a half months period.

6. Required Qualification and Expertise

Firms meeting the following are encouraged to apply:

• Firms have experienced team members in financial product development, risk management and cooperative development with a master’s degree in business management, accountancy, finance, cooperative or other relevant fields. 
• Proven experience (five years or more) and expertise in savings and credit product development, financial risk management, available funds utilization, external loan facilitation, liquidity management, repayment, recovery, clean up non-preforming assets, legal compliance and internal policy development. 
• Familiar with policies, regulations and directives of the National Cooperative Regulatory Authority.  
• Strong understanding of cooperative sector, cooperative policies, directives, and Nepal Rasta Bank guidelines.
• Experience working with smallholder farmers, cooperatives, and agri-SMEs in Nepal or similar contexts. 
• Excellent analytical, writing, and presentation skills.

7. Reporting & Supervision

The consultant/team will work under the direct supervision of Access to Finance Lead and coordinate closely with Program Manager-Cooperative Development. Regular progress updates will be provided as agreed.

8. Application Process

Qualified firms or teams are invited to submit the application along with below documents to                                    Procurement-NP@heifer.org with the title “Application for for Strengthening Risk Management, Financial Product Development and Fund Utilization of Farmer’s Cooperatives in Nepal” no later than 15 April, 2026, 5:00 PM.

Documents Required:

• Cover letter
• A technical proposal outlining understanding of the ToR, methodology, workplan and team composition.
• Financial proposal
• CV of key personnels (not more than 3 pages each CV)
• Registration certificate
• VAT certificate
• Tax clearance certificate (FY081-82) 
• Relevant work samples

Note: VAT registered vendors are encouraged to apply.

Heifer reserves the right to accept or reject any proposal and to annul the selection process and reject all Proposals at any time prior to contract award, without thereby incurring any liability to affected individuals.