Context
The agricultural and food industry is a crucial sector of the economy in many African countries. It can make a significant contribution to economic development and income security. However, many small rural enterprises are not geared to market needs and lack access to suitable financial services, such as loans for specific value chains. This limits their investment options.
Objective
Agricultural and agri-based enterprises in rural areas have improved access to suitable financial services.
Approach
The project works jointly with local financial institutions and agricultural businesses:
1. It improves participants’ capacities through training in financial education, value chain financing and business model and investment analysis, and develops their business administration skills.
2. It analyses financial services such as investment loans and adapts them to the needs of agri-businesses. The loans are an addition to the portfolio of the financial institutions and will be permanently available to businesses in future.
3. To protect borrowers from the risks of loan-based investments, the project promotes the combination of financial and insurance products for agri-businesses.
4. It particularly supports enterprises led by women and young people in order to enhance their economic and social participation.
The Luxembourg Development Cooperation Agency (LuxDev) is an important finance provider in Benin. Internationale Project Consult GmbH (IPC) and AFC Consulting Group provide advisory support to the project.