The United nations International Find for Agricultural Development(IFAD) has just created the Private Sector Financing Programme(PSFP) for rural businesses to support; fight poverty, climate change, and hunger. It is also to advance the inclusion and empowerment of weak groups in poverty-stricken countries.
The program will give support in form of equity, loans, investments, and guarantees to farmers’ organizations, small and medium-sized enterprises(SMEs), and financial intermediaries who are servicing small-scale farmers. The initial goal of IFAD for PSEP is to raise USD 200 million from private donors and investors and also using private investments of USD 1 billion to assist 5 million small-scale and subsistence farmers
The initial funds released from PSFP is a loan of USD 5 million to Babban Gona, a social enterprise in Nigeria. The firm is focused on helping farmers cross from subsistence Agriculture to commercial farming.
Babban Gona’s plan for the loan is to provide training, inputs, and marketing services to about 377,000 Maize and rice farmers all over Nigeria.
It also plans to assist farmers in the storage of surplus harvest and create not less than 65,000 jobs for women and youth each by 2025.
The loan disbursed to Babban Gona is the first transaction of IFAD that is neither a grant nor sovereign loan.
Gilbert F Houngbo, IFAD President said “We urgently need to stimulate more private sector investments to rural areas and unlock the immense entrepreneurial potential of millions of rural SMEs and small producers. With access to capital, they can attract more investors and partners, grow their businesses, and create employment opportunities – especially for young people and women.”
IFAD was established in 1977 and governed by its 176 member nations.
Its goal is to eliminate rural poverty in developing countries.
With a focus on Agriculture and food supplies, IFAD provides loans and grants to research organizations, private firms l, governments, and civil society organizations.
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