Access to funding remains a major challenge for many Kenyan farmers, especially small-scale agribusinesses. Nonetheless, there are still various financial resources available, including government programs, local financial institutions, private investors, and select international organizations. Recently, USAID funding was frozen. Now, it’s crucial to know where to look. Proper positioning is essential for your agribusiness to secure support.
Here’s an updated guide to help you access funding and grants for your agribusiness in Kenya.
1. Government Funding and Support Programs
The Kenyan government continues to offer support for farmers. They offer various initiatives designed to boost agricultural productivity. These initiatives also enhance value addition and improve rural livelihoods.
Key Programs:
- Agricultural Finance Corporation (AFC): Offers subsidized loans for agricultural projects ranging from crop production to agro-processing.
- Youth Enterprise Development Fund (YEDF): Targets youth-run agribusinesses with low-interest loans and capacity-building support.
- Uwezo Fund: Provides accessible loans to youth, women, and persons with disabilities to support small businesses, including those in agriculture.
- Ministry of Agriculture Programs: Through county governments and national programs, farmers can access grants, subsidized inputs, and training programs.
Steps to Access:
- Regularly check government websites and local agricultural offices for calls for applications.
- Prepare a solid business plan outlining how the funds will be used and the expected impact.
- Meet basic eligibility criteria (e.g., valid ID, group registration for community projects, tax compliance).
2. Microfinance Institutions and SACCOs
Microfinance institutions have become essential for smallholder farmers. Savings and Credit Cooperative Organizations (SACCOs) also play a crucial role. These institutions help farmers who lack collateral or formal credit histories.
Key Institutions:
- Faulu Microfinance Bank
- Kenya Women Microfinance Bank
- Equity Bank (Fanikisha Loans for Agribusiness)
- One Acre Fund (credit and inputs for smallholder farmers)
Why They Work:
- Flexible loan structures tailored to seasonal farming.
- Group lending options that reduce collateral requirements.
- Support with financial literacy and agribusiness planning.
3. International Donors and Alternatives to USAID
USAID has frozen funding in certain areas. Nevertheless, other international development organizations stay active in supporting Kenyan agribusinesses. They focus on those aligned with sustainability, food security, and climate resilience.
Active International Funders:
- International Fund for Agricultural Development (IFAD): Focuses on rural development, farmer cooperatives, and climate-smart agriculture.
- World Bank (Agriculture and Food Global Practice): Offers funding and support for national programs and regional agriculture projects.
- AgriFI Kenya Challenge Fund (EU-funded): Targets private sector agribusinesses that promote inclusive value chains.
- Global Alliance for Improved Nutrition (GAIN): Supports projects addressing nutrition and food systems transformation.
Tips to Secure International Grants:
- Focus your agribusiness proposal on development goals like food security, gender inclusion, or climate change.
- Collaborate with NGOs or farmer cooperatives already linked to these funders.
- Register with grant platforms like Grants.gov, Devex, or VC4A to stay updated on open opportunities.
4. Private Sector Investors and Agribusiness Incubators
With the growing interest in sustainable and tech-enabled farming, private investors are increasingly backing agribusinesses with scalable models.
Where to Look:
- Venture Capital & Impact Investors: Like Acumen, Root Capital, and Pearl Capital Partners.
- Agribusiness Accelerators: Like iAgribiz, AGRA’s VALUE4HER, and Villgro Africa.
- Online Investor Platforms: Including VC4A, Angelist Africa, and DEALROOM.
What Attracts Investors:
- Clear market opportunity and revenue model.
- Innovative approach (e.g., agri-tech, value addition, renewable energy integration).
- Social and environmental impact (job creation, women/youth empowerment, eco-friendly practices).
5. Other Models: Crowdfunding and Community Financing
Crowdfunding is emerging as a powerful tool for agribusinesses to raise money directly from the public. It also doubles as a marketing tool.
How to Leverage It:
- Use platforms like StartSomeGood, Thundafund, or M-Changa (Kenya-based).
- Tell a compelling story with videos, testimonials, and clear use of funds.
- Offer rewards or community recognition to supporters.
Community Financing Models:
- Table banking and chama groups allow members to pool resources and offer low-interest loans.
- Rotating savings groups offer consistent access to small capital for supply purchases or equipment.
6. Tips for a Successful Funding Application
Regardless of the source, these tips will help improve your chances:
- Have a clear business plan: Outline your vision, goals, financial projections, and impact.
- Keep proper records: Financial and production records build your credibility and help during vetting.
- Start small and grow: Donors and lenders prefer businesses that show consistent, manageable growth.
- Stay informed: Join farmer groups, attend agribusiness expos, and follow funding announcements on relevant websites and social media.
Final Thoughts
The freezing of USAID funding has removed a major source of support. However, Kenyan agribusinesses are still surrounded by opportunities. These include government-backed programs, new international donors, and creative financing models. With a solid plan and strong community connections, you can still access funding. Be willing to adapt to take your farm or agribusiness to the next level.
