The Alliance for Green Revolution in Africa has agreed to partner with Aceli Africa to grow capital flows to Small and Medium Enterprises in the agriculture sector and to transform agriculture through financial inclusion in Africa.
The Chief Executive Officer of Aceli Africa, Brian Milder, stated, “AGRA and Aceli have signed a letter of intent committing to jointly work together to test and scale up innovations that substantially drive down the cost and risk of financing SMEs in the agriculture space.”
Aceli Africa is a market incentive facility that offers financial incentives to mitigate risk and compensate lenders for the transaction costs of serving high-impact agricultural SMEs. It plans to support its 25 lending partners in mobilising $700m for agri-SMEs by 2025, with a focus on SMEs that are gender-inclusive, improve food security and practise climate-smart agriculture.
Aceli Africa, Milder said, shares AGRA’s vision for an inclusive and sustainable agricultural transformation that creates economic opportunities, builds a resilient regional food system and stewards the natural environment.
He added, “Achieving this vision is only possible if we can unlock the growth and impact potential of agricultural SMEs. Building on AGRA’s leading role as a convener and advocate and Aceli’s data-driven approach to mobilising private sector lending. Together we can address the long-standing barriers that limit the flow of capital to agricultural SMEs.”
The Vice President, Strategic Partnerships with AGRA, Vanessa Adams, said, “AGRA firmly believes that it is vital to unlock the potential of SMEs for agricultural transformation across Africa. This partnership with Aceli is a step in this direction, as the increased capital flows and technical assistance will enable the SMEs to unleash their potential and offer better services to smallholder farmers.
“This partnership will also work on implementing digital solutions to make financial record keeping and reporting more efficient and reliable which will improve the bankability of the SMEs.”
AGRA and Aceli share relative ideology and plan to work together to promote innovations to see to the flow of capital to agricultural SMEs. The announcement will trigger innovation challenge for sustainable, scalable and innovative business development solutions, specifically to enhance quality of financial statements.
The Head, Innovative Finance, Hedwig Siewertsen, said, “As AGRA, we want agricultural SMEs to grow; and for that growth, access to finance is key. Our partnership with Aceli Africa seeks to address the cause of the lesser return on agricultural SME finance by investing in innovation that reduce the cost and risk of financing smaller SMEs.”
For the Head of Partnerships, Aceli Africa, Christabell Makokha, “Aceli is thrilled to partner with AGRA in promoting innovations that will lower transaction costs for lenders to serve agricultural SMEs. Agri-SMEs play a critical role in ensuring more inclusive and sustainable food systems, yet they remain significantly underserved.”
AGRA is an alliance led by Africans with roots in farming communities across the continent.
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