The African Development Bank Group (AfDB) has received $14 million under a new private-sector financing window of the Global Agriculture and Food Security Program (GAFSP) to support smallholder farmers and agribusinesses across Africa.
The facility, GAFSP’s first allocation under its new Business Investment Financing Track, is expected to unlock up to $200 million in private-sector capital to strengthen food systems in low-income African countries.
The funds will go towards establishing an Agro-Inputs Risk Sharing Facility, a $200 million fund hosted by the AfDB, aimed at incentivising local banks to lend to agro-input suppliers. An additional $4 million grant will provide technical assistance and support to agricultural small and medium-sized enterprises (SMEs) in Ethiopia, Uganda, Tanzania, Malawi, and Zambia.
The initiative targets more than 1.5 million smallholder farmers and 500 agro-dealers and cooperatives, addressing long-standing financing barriers in Africa’s agriculture sector. Many small-scale farmers and agribusinesses remain locked out of credit and investment due to high perceived risks and lack of collateral.
The Agro-Inputs Risk Sharing Facility will be implemented by the African Trade & Investment Development Insurance (ATIDI), which provides political and credit risk insurance to investors across the continent. It will offer guarantees to local financial institutions to encourage greater lending to agrifood enterprises.
Natasha Hayward, GAFSP Program Manager, said the new model demonstrates “the appetite for funders to work together to solve an age-old challenge of finance for smallholder farmers: risk.”
“By blending GAFSP donor funds with multilateral development and commercial finance, every program dollar will leverage many more in private investment, multiplying the positive impact on food security and resilience,” she said.
The facility is expected to expand farmers’ access to certified seeds, fertilizers, mechanisation, and soil enhancers, enabling them to adapt to extreme weather and climate shocks.
AfDB’s Coordinator for GAFSP, Philip Boahen, said the initiative would strengthen Africa’s entire agricultural value chain, from input supply to market access.
“With the Agro-Inputs Risk Sharing Facility, we are planting the seeds of a more food-secure Africa,” he said.
The project aligns with the continent’s broader commitments to food systems transformation, including the Comprehensive Africa Agriculture Development Programme (CAADP) and the Kampala Declaration on accelerating agricultural resilience and growth.
