Mandate & funders
EDFI AgriFI, the Agriculture Financing Initiative, is an EU-funded impact investment facility with a mandate to provide medium to long-term financing to private sector enterprises active in the agri-food value chain with a focus on smallholder farmers.
Unlock, accelerate and leverage sustainable agriculture finance
Reducing poverty (SDG1) and hunger (SDG2) while promoting inclusive growth (SDG8) requires substantial investment in agriculture, particularly in rural areas and in those countries with the greatest needs. As the most vulnerable populations live in rural areas, investing in small-scale farming brings direct benefits to the local socioeconomic situation and reduces its dependency on external assistance.
Greater efforts are needed to reduce the financing gap in lending to smallholder farmers and agricultural SMEs. An estimated 270 million households in Asia, sub-Saharan Africa and Latin America rely on smallholding farming for their subsistence. A lack of adequate land, infrastructure and skills means that more than EUR 200bn in agriculture and non-agriculture finance is required to meet the growing need.
The latest data suggests that currently only 30% is financed. The EU has played a major role in developing innovative instruments, approaches and structures for offsetting risks and creating fresh ways for further private capital to contribute to agricultural finance.
Launched in 2018, EDFI AgriFI – the Agriculture Financing Initiative – is an EU-funded innovative, inclusive impact investment facility for supporting access to finance for agri-SMEs and smallholder farmers.
Empowering smallholder farmers in developing countries
EDFI AgriFI targets existing private sector enterprises working with smallholder farmers on financially, environmentally and socially sustainable projects with potential to scale.
It aims at supporting the “missing middle” companies focused on agriculture that need financing to grow but have difficulty obtaining financing from local commercial banks and international investors.
EDFI AgriFI will support the increase of yields at affordable rates and help raise farmer incomes. Increased farmer income and adherence to the highest environmental and social standards will support sustainable supply chains that create additional employment, improve food security and enhance environmental and social practices.
EDFI AgriFI is managed by the EDFI Management Company, a company established by the 15 European Development Finance Institutions.