Approximately 16,000 small-scale farmers in East Africa were supported in 2021, as a result of a USD 1 million debt facility extended in 2020 by Trade and Development Fund (TDF), enhanced with a partial risk guarantee from the African Guarantee Fund (AGF), and managed by Grassroots Business Fund (GBF). The Facility finances agribusinesses by providing working capital, expansion funding, and value addition support.

So far, USD 860,000 has been committed to three high impact SMEs led and owned by women and youth – Coconut Holdings Limited and Chemicaland Limited in Kenya and Rainbow Haulage and Commodity Traders in Tanzania. The Facility enabled these companies to grow their capacities, develop new products, deepening value chains, and generating more opportunities for value chain actors.

~Rainbow Haulage Tanzania buys and exports agricultural produce from hundreds of small holder farmers in Tanzania and exports to Rwanda, Burundi, Uganda and other countries.

~Coconut Holdings Limited buys coconuts from smallholder farmers and manufactures coconut value-added products.

~Chemicaland manufactures crop nutrition products for sale from the production of smallholders and commercial farmers across Kenya enabling them to improve their productivity and profitability.

With SMEs providing most jobs in the region, and being a high contributor to GDP, this Facility was structured to solve a market challenge for missing middle SMEs that are unable to access medium to long term patient capital from conventional borrowing. To further improve results and sustainability of the interventions, all three companies are benefitting from TDF and AGF technical assistance contributions blended with the Facility.

Admassu Tadesse, TDB President Emeritus and Group Managing Director said: “We are pleased to be able to support such impactful businesses via TDF, our Group’s special institution that supports early-stage interventions and is indeed well placed to unlock finance for some facing barriers to access capital. Because of their important contribution to livelihoods and economies, SMEs are crucial to the achievement of meaningful sustainable development in our region.”

Gloria Mamba, TDF Executive Director and TDB Group Senior Executive said: “TDF’s approach consists in leveraging its capital, blending it, and directing it through partner financial institutions, such as GBF, who work with SMEs – from micro enterprises to missing middle SMEs – as their client-base. By providing tailor-made blended finance solutions, the Facility empowers local women and youth-led businesses to grow and generate jobs, and contribute to economic growth”.

Harold Rosen, GBF’s Chief Executive Officer said: “GBF is delighted to have been in partnership on this transaction with TDF and AGF. We are very aligned with TDB’s mandate and its modus operandi of using blended solutions to reach underserved communities. We also feel this transaction has been a good way for GBF to combine its experience and capabilities working with SMEs, with TDB’s strong capabilities and desire to help SMEs reach their potential to lead the development process in Africa.” 

Jules Ngankam, AGFs Group Chief Executive Officer said: “We are glad that our guarantee facility played a major catalytic role in enabling GBF to support the beneficiary agribusinesses majority of whom were women. Our Capacity Development Assistance was also very critical in empowering the farmers and positioning them to attract investments.”