Global Affairs Canada (GAC) and Norway are Aceli Africa’s newest funding partners, bringing total donor commitments to $93M. They join IKEA Foundation, the Ministry of Foreign Affairs of the Netherlands, the Swiss Agency for Development and Cooperation, UK International Development, and USAID’s Feed the Future initiative as anchor funders.
Launched in September 2020, Aceli Africa is a market incentive facility working to mobilize $1.5 billion in private sector lending to small and medium enterprises (SMEs) in the East African agriculture sector by 2030. As of March 2024, 38 leading commercial banks and impact investors have signed on to Aceli Africa’s financial incentives program, which mitigates the risk and improves the returns of lending to high-impact agricultural SMEs.
In its first three and a half years of operations, Aceli supported its lending partners in issuing 1,867 loans totaling $173M. Nearly two-thirds of loans have been made to first-time borrowers, and SMEs receiving Aceli-supported loans have created market access for 990,000 smallholder farmers and employed 33,000 full-time workers. Aceli’s financial incentives are tiered to reward loans to businesses that create economic opportunities for women and youth, contribute to food security and nutrition in Africa, and promote practices that sustain the environment and improve climate resiliency.
“Small and medium agricultural businesses are the backbone of local communities and have the potential to drive inclusive economic growth,” said Ahmed Hussen, Canada’s Minister of International Development. “Canada’s support will help Aceli to scale-up its operations in Eastern Africa and on-board new lenders to its innovative program, further boosting local businesses, particularly those led by women and youth.”
“Financing plays such a big part in unlocking the potential of local production and distribution of food,” said Anne Beathe Tvinnereim, Norway’s Minister of International Development. “It is of crucial importance for a small business in the food sector to have access to capital to expand the business and help increase local food security. Norway is committed to using public funds to reduce risks and make banks more keen to invest in agri-SMEs.”
More information on Aceli Africa’s approach and progress to date can be found in its Year 3 Learning Report.
