IFAD and AgDevCo Sign $10M Loan Agreement to Mobilize Blended Finance for African Agribusinesses

The International Fund for Agricultural Development (IFAD) and AgDevCo Ventures Limited have finalized a $10 million loan agreement to mobilize blended finance for early-stage agricultural enterprises across Sub-Saharan Africa. Initial deployments will target Ethiopia, Kenya, Rwanda, Tanzania, and Uganda. AgDevCo will structure the facility alongside dedicated technical assistance to address capital shortfalls in primary production, input supply, aggregation, and processing.

This commitment marks the first close of AgDevCo Ventures, a $49 million specialized vehicle designed to address the persistent early-stage missing middle in African agricultural finance. The loan provides risk-tolerant, subordinated debt to de-risk investments and catalyze private capital for early-stage agribusinesses in underserved markets, enabling them to scale, boost productivity, expand market access, and enhance environmental and social practices. According to IFAD, the initiative will support up to 15 enterprises, benefit nearly 128,000 smallholder farmers, and create approximately 2,900 full-time jobs over 12 years, with a priority on locally owned and women-led businesses.

According to AGRA, African small and medium agribusinesses face a $65 billion financing shortfall, contributing to a broader continental agricultural financing gap of roughly $180 billion. The $10 million in concessional subordinated debt is structured to absorb downside risk and reduce the overall cost of capital, encouraging private investors to scale up agricultural investments.

“Africa’s food systems need a broader range of financing solutions that match the realities of agricultural businesses at different stages of growth,” said Donal Brown, IFAD Associate Vice-President for Department of Country Operations. “Our partnership with AgDevCo demonstrates how blended finance can unlock investment for promising enterprises, strengthen rural economies and create opportunities for women, young people and small-scale farmers across the continent.”