In the next three years, the Treasury will fund the Agricultural Finance Corporation (AFC) with Sh1.5 billion set as a state-owned entity.
The funds will help AFC to extend credit, offer technical help to clients in agriculture, rural development, and those tackling food security all as a way to further its operations.
The Treasury has a target of Sh500 million for the year ending July and another Sh1 billion for the next two years stating that this is a strategic investment in the public sector.
“The amount of capital injected and absorbed into the strategic-owned entities AFC (is targeted at) Sh500 million for 2020/21, Sh500 million for 2021/22 and Sh500 million for 2022/23,” said the Treasury in the program based budget.
AFC is set to promote women by increasing its clients’ funds through grants, concessional credit, technical assistance, and risk-sharing.
“To facilitate a successful deployment (of loans to women), the corporation is looking for partners, to assist through financial concessional credit lines, guarantee mechanism, risk-sharing facilities, innovation funds, grants for technical assistance and even grants for enabling environment and infrastructure like post-harvest handling at communal levels to generate confidence in warehouse receipts systems. This could benefit many smallholder farmers, most of who are women,” said the AFC.
The organization promotes the female-led enterprises through the Women Affirmative Window that came into action after the realization that most women did not have hard collateral. This led to a large part of the organization’s loan benefiting men with just 5% going to women.