While fi nancial institutions have had relatively little success in overcoming the risks and costs of lending to agriculture, rising food prices and shortages have made it imperative to fi nd better ways of increasing fi nancial fl ows in support of increased agricultural production and marketing. Direct value chain fi nance transactions operate with the same logic as any other fi nancial transaction. The lender must engage in some form of client screening, client monitoring and contract enforcement. To successfully accomplish these tasks, direct value chain lenders can use information gained through their value chain relationships about their clients and their clients' businesses. The value chain governance structure infl uences how easily and successfully a value chain lender can accomplish these tasks.Value chain governance structures can be defi ned with a typology along a continuum of four types of relationships described generically as market based, balanced, directed and hierarchical. A market-based value chain provides little opportunity for a lender to screen or monitor clients or the conditions needed to enforce contracts. A balanced value chain has incentives for fi rms to share information, jointly ensure product targets are met and respect contracts that refl ect interdependencies. A directed value chain provides the lead fi rm with access to information, control over supplier production and the power to enforce contracts. Therefore, we expect to see more examples of successful direct value chain fi nancing in value chains with a directed governance structure, but fewer examples in value chains with a market governance structure.