De-risking agricultural finance to drive gender-inclusive, climate-resilient growth in Agri-SMEs

With a crippling $96 billion access to finance gap for agricultural Small and medium-sized enterprises (SMEs), and a ninety seven percent insurance protection gap, the Bank’s De-risking Agriculture Finance and Climate Resilience (DAFCR) team works to mobilize concessional resources, reduce and transfer risk and enable inclusive and climate resilient growth for African Agriculture SMEs.

DAFCR houses several flagship initiatives, including the Agri-Food SME Catalytic Financing Mechanism (ACFM)—the Bank’s first blended finance initiative focused specifically on Agri-SMEs, the Africa Disaster Risk Financing Program (ADRiFi), which provides sovereign-level disaster risk insurance, and the Africa Climate Risk Insurance Framework for Adaptation (ACRIFA), which extends insurance to the meso and micro levels of food systems through African insurers.

An engine for Agri-SME growth

The Agri-Food SME Catalytic Financing Mechanism (ACFM) is designed to de-risk investments in agricultural small and medium enterprises (Agri-SMEs). Capitalized with $85 million from the Government of Canada, ACFM combines a co-financing investment facility and a technical assistance window to unlock private and public capital.

The mechanism supports financial intermediaries to channel resilient and inclusive finance to Agri-SMEs. Guided by gender and climate eligibility criteria it ensures that every investment contributes to building a more resilient, inclusive, and sustainable agri-food sector across Africa.

ACFM operates through strategic collaboration across the Bank, working closely with the Agriculture and Rural Finance Division, the Financial Sector Development Department, and the Affirmative Finance Action for Women in Africa initiative. These partnerships bring together complementary expertise to expand access to finance, advance gender inclusion, and build the resilience of Agri-SMEs.

Unlocking investment at scale for Agri-SMEs

The ACFM is demonstrating how blended finance can unlock large-scale, inclusive, and climate-resilient investment across Africa’s agricultural sector. By strategically deploying concessional finance, ACFM reduces investment risk, builds confidence among financiers, and channels resources toward Agri-SMEs that drive climate resilience and inclusive agri-food development pathways. With  $30 million in concessional and catalytic investments to date, ACFM has mobilized more than $500 million in additional private sector resources and more than $450 million in additional public sector resources. This catalytic effect[^1]: demonstrates how targeted de-risking can attract both public and private capital at scale.

Together, these investments are designed to support 834 Agri-SMEs through ACFM’s investees, driving innovation, finance and market access, and sustainable job creation. By embedding gender and climate criteria into investments, ACFM ensures that this growth is inclusive, resilient, and measurable, translating directly into tangible outcomes:

• 564 Agri-SMEs improving gender inclusivity,
• 648 Agri-SMEs strengthening climate resilience, and
• 6,494 new jobs with 50% for women and 75% for youth.

A compelling example of ACFM’s catalytic power is its partnership with Sucden in Côte d’Ivoire, helping pilot an innovative financing scheme for farmer cooperatives in Côte d’Ivoire, providing uncollateralized, zero-interest which enables ten farmer cooperatives to access equipment and warehouse financing—benefiting more than 75,000 farmers.

Based upon the performance of the farmers scheme, Sucden’s would reinvest its own resources to expand these schemes, highlighting how strategic financial structuring and public-private collaboration can amplify impact, strengthen agricultural value chains, and foster sustainable, climate-resilient growth across Africa.

Building knowledge and capacity through technical assistance

ACFM also deploys technical assistance to strengthen the capacity of both investees and Agri-SMEs, equipping investees to operate more efficiently, develop innovative solutions, and better serve Agri-SMEs.

• Through a strategic partnership with Open Capital Advisory (OCA) in Kenya, ACFM has strengthened the capacity of 193 Agri-SMEs across Seed Lab and Growth Facility, helping them raise $20.2 million in additional private sector capital—an eleven-fold return on the catalytic technical assistance investment. This support has enhanced SME bankability, strengthened climate resilience, and improved gender inclusion, while indirectly benefiting 1.8 million smallholder farmers by improving access to markets, financing, and innovative agricultural solutions.

Success story: Through OCA’s Growth Facility, ACFM enabled the Three Mountains Cocoa cooperative to raise USD 1.5 million in additional finance for expanding sustainable cocoa production, demonstrating how targeted technical assistance can unlock capital and scale climate-smart practices for specific agri-value chains.

• Through the Kenya National Farmers’ Federation, ACFM is also onboarding 250,000 farmers onto the Mastercard Pass platform. The technical assistance has already empowered over 81,000 farmers—43% of whom are women—across 14 counties. By leveraging verified farmer data as collateral, the initiative aimed to strengthens market access, financial literacy, and cooperative capacity, while using verified farmer data as collateral to reduce financial risk.

Lessons learnt

The ACFM showcases how concessional finance can de-risk investments, unlocking private and public capital for agricultural SMEs. Combined with targeted technical assistance, this approach strengthens Agri-SME capacity, enhances access to markets, promotes climate resilience, and advances gender inclusion. Strategic partnerships across public and private actors amplify reach and foster sustainable, market-driven solutions.