Small Foundation is excited to be partnering with Samawati Capital Partners (SCP) to complete a feasibility study on designing a Collateral Management Agreement (CMA) Fund and Technical Assistance Facility (TAF). Over the coming months, this initiative will explore ways to provide working capital to agri-SMEs through local financial institutions in Kenya, Uganda, Tanzania, and other markets in sub-Saharan Africa (SSA).
In response to the lack of structured and tailored working capital solutions for food and agri SMEs across SSA, SCP is engaging in this study to develop a CMA product that will allow for asset-based financing using financed agricultural commodities as collateral, providing a working capital solution for agri-SMEs to access much needed liquidity to scale their operations.
Sonja Riedke, co-Founder of SCP says:
“We are excited to partner with Small Foundation in developing this initiative. Agriculture small and medium enterprises are the backbone of many African economies, yet they face an enormous funding gap that limits their growth potential. We strongly believe that providing agri-SMEs with suitable financing solutions in partnership with local financial institutions can unlock their potential and drive social and economic transformation across the continent.”
Small Foundation hopes this study will result in a CMA product and fund that enables access to working capital for agri-SMEs that lack fixed asset collateral. In addition, the TAF would support agri-SMEs to build capacity and improve gender inclusion; and equip local financial institutions with tools, systems, and trainings to increase lending to agri-SMEs using CMA contracts.
Samawati Capital Partners is a Nairobi-based investment and impact advisory firm that offers its services across SSA.
This article was originally published by: Small Foundation
