WEST AFRICA – The Agri-Business Capital Fund (ABC Fund), a blended-finance impact fund has issued loan financing worth £1.2 million (US$1.4m) to two West African companies i.e. Anatrans, a cashew nut processor based in Burkina Faso and Maphlix Trust Ghana Limited, a producer and processor of tubers and vegetables.
The investment is aimed to enable the companies weather the COVID-19 pandemic which has put unprecedented pressure on small- and medium-sized enterprises (SMEs) around the globe.
According to the fund manager, Bamboo Capital Partners, these investments will enable smallholder farmers to maintain their businesses and contribute to job creation and growth in their communities.
“We are pleased that even during the COVID-19 crisis, the ABC Fund continues to invest in the future of African agribusiness,” said Jean-Philippe de Schrevel, founder and managing partner of Bamboo Capital Partners.
“The loans provided to Anatrans and Maphlix will help both businesses scale significantly in the coming months, provide jobs to boost the local economies and ultimately improve the livelihoods of people living in the communities they impact,” he said.
The loan to Anatrans will help the cashew business facilitate market access for six farmer groups with over 1,200 members.
It will secure revenue for these farmers at the time the raw cashew nuts are purchased, while also providing additional revenue at the end of the harvesting period.
The loan will also enable the farmers to receive premiums under the Organic and Fairtrade certifications.
With this loan, Anatrans plans to generate employment opportunities for up to 1,500 people during the 2020/21 season, as well as selectively funding community projects to benefit the lives of over 7,000 residents in the region.
Maphlix will use its loan to expand sweet potato production, resulting in a significant increase in farmer revenues.
ABC Fund’s financing will act as a catalyst for Maphlix to secure more supplier contracts in order to further increase its network of smallholder farmers.
The company will be able to increase the size of its out-grower scheme by tripling the number of smallholder farmers, which will create nearly 600 jobs and ensure that nearly 1,100 laborers receive an improved daily income.
“The loans provided to Anatrans and Maphlix will help both businesses scale significantly in the coming months, provide jobs to boost the local economies and ultimately improve the livelihoods of people living in the communities they impact.”Jean-Philippe de Schrevel – Founder and Managing partner of Bamboo Capital Partners
The ABC Fund provides catalytic financing to underserved, yet profitable segments of agribusiness value chains in developing countries.
The Fund deploys loans and equity investments in farmer organisations, rural SMEs, and financial institutions.
What cemented the decision for the team looking at Anatrans and Maphlix was the fact that their business models were intrinsically linked to the people and communities the ABC Fund seeks to impact.
These businesses continue to support the livelihoods of smallholder farmers, which in turn, goes on to impact the local communities in which they operate.
In addition, they have a comprehensive understanding of the risk they face as a business and have put in place the right mechanisms to track and mitigate these risks to improve their chances of business success.
It was initiated by the International Fund for Agricultural Development (IFAD) in partnership with, and is currently funded by investments from, the European Union, the Organization of African, Caribbean and Pacific States (OACPS), the Luxembourg Government and the Alliance for a Green Revolution in Africa (AGRA).
The recent investment follows ABC Fund’s £800,000 (US$947,000) loan provided to Dragon Farming, a Ghana-based soya milling and aggregation company in June and the US$3 million loan provided to INSOTEC, a finance provider for Ecuador’s agriculture sector in August.
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