LAFCo is a Mauritius based investment company providing financing facilities in the form of loans to African agricultural businesses that work directly with smallholder farmers. LAFCo seeks to generate social and economic impact for the African agriculture sector, including direct impact on SMEs and indirect impact on smallholder farmers through higher and more stable incomes, improved farm productivity, reliable markets, and increased food security.
INVESTING IN AFRICAN FARMING
Beginning with a first close of $15 million in committed funds, LAFCo aims to become a leading provider of capital for agricultural businesses operating in various industries, with a primary focus on enterprises that advance local and regional food security. The innovative blend of public and private capital will allow the Facility to serve parts of the market that are generally not being served by commercial banks or other financial institutions. As the LAFCo portfolio grows, the Facility will continue to raise appropriate funds from public and private sources.
OBJECTIVES
Improve rural livelihoods
Enhance food and nutritional security
Catalyze a financial market to benefit smallholder farmers
IMPACT GOALS
LAFCo serves the day-to-day working capital needs of African agricultural businesses and farmer cooperatives, particularly those advancing food security by operating in staple food crop value chains.
Provide Credit
Provide short-term loans and flexible lines of credit to enable agricultural enterprises that work with smallholder farmers to grow and source higher volumes of product from farmers. This in turn creates income generation opportunities for smallholder farmers and actors throughout the value chain.
Social & Economic Impact
Generate social and economic impact for the African agriculture sector, including direct impact on increased employment and increased revenues for SMEs, as well as indirect impact on smallholder farmers through higher and more stable incomes, improved farm productivity, reliable markets, and increased food security.
Demonstrate Viability
Demonstrate the viability of agricultural finance in Africa by generating positive returns for the Facility and its shareholders, servicing a blend of impact and commercial debt, and attracting additional finance to the sector.
PORTFOLIO
LAFCo targets commercial SMEs and farmer cooperatives that have limited access to working capital, but are able to responsibly repay loans.
The portfolio includes African SMEs that meet the facility’s borrower criteria in various value chains and business types. LAFCo plays an additive role in the market by providing loans to businesses that face barriers to accessing working capital from the local financial sector for reasons such as overly stringent security requirements, cumbersome loan approval and disbursement processes, and prohibitive or opaque pricing.
