Wednesday, December 11, 2019
Smallholder farming households in sub-Saharan Africa, South and Southeast Asia and Latin America collectively require more than USD 240 billion in agriculture finance to optimize their farm operations. The last five years have seen an unmistakable acceleration in the number of providers engaging smallholder farmers through new products and service delivery models. From formal financial institutions to FinTechs and agribusinesses, private sector actors are shifting their perception of smallholders and the investment opportunity they present. Yet despite this progress, over USD 170 billion of this demand for smallholder agricultural finance goes unmet. The higher cost and risk of serving smallholder farmers means many providers often pursue higher return opportunities and continue to be reluctant to serve the world’s poorest farmers.
IDH Farmfit (“Farmfit”) and Mastercard Foundation Rural and Agricultural Finance Learning Lab (“The Learning Lab”) have joined forces to change this. Farmfit supports the development of viable business models delivering finance and other services to farmers. Through tailored business support and affordable and appropriately structured financial support, Farmfit helps providers identify and realize opportunities for innovation and scale-up. The Learning Lab, a thought leader in rural and agricultural finance, works closely with Farmfit to provide business support to financial service providers operating in sub-Saharan Africa.