GAFSP launches $75 million fund to support small farmers and agri startups

The Global Agriculture and Food Security Program (GAFSP) has launched a new $75 million investment initiative to boost financial innovation for smallholder farmers and micro, small and medium-sized enterprises (MSMEs) in the agri-food sector. This initiative, known as the Business Investment Finance (BIFT) pathway, aims to increase food security and agricultural development in low-income countries by making it easier for private investors to mobilize additional resources in traditionally underserved segments of the food system.

The launch of BIFT is timely as the global food system faces challenges such as supply chain disruptions and the growing impact of climate change. GAFSP, the multi-stakeholder partnership platform established by the G20 in 2010, has committed over $2.5 billion to date to support global food and nutrition security. BIFT, part of the broader GAFSP strategy, focuses on promoting transformative agricultural investments through blended finance solutions, particularly in under-resourced regions and value chains.

BIFT will encourage public-private partnerships and support civil society engagement, helping to connect the resources of influential investors, banks and asset managers. This aggregate funding will support larger-scale programs that aim to achieve more impactful results. The track focuses on strategic public investment in nutritious food value chains, collaboration with non-governmental organizations and the use of financial instruments such as concessional debt and equity to attract private investment.

The BIFT pilot, running until June 2026, will be implemented in partnership with organizations such as the African Development Bank, the Asian Development Bank and the International Finance Corporation. It will focus on small farmers, small and medium-sized enterprises and agri-business start-ups involved in the production and marketing of nutritious food, sectors often overlooked by private investors due to perceived risk or low returns.

Through innovative financing solutions, BIFT aims to help these high-potential but underserved segments scale their businesses and gain access to mainstream financing.

First Posted: October 3, 2024 12:21 PM EST