By Lydia Labanya
In a move to enhance financial inclusion and support agricultural value chains, Equity Group Holdings and the World Food Programme (WFP) have signed a strategic framework agreement.
The collaboration aims to link value chain actors in food and agriculture to financial literacy training and concessional financing through Equity Bank subsidiaries.
The agreement, signed by Dr James Mwangi, the managing director of Equity Group Holdings and Cindy McCain, the executive director of WFP, took place on the sidelines of the WFP executive board session in Rome.
This initiative represents a pioneering model of private sector engagement for development impact, focusing on supporting marginalised communities where traditional financing is limited.
The partnership will leverage WFP’s extensive field presence and engagement with value chain actors, combined with Equity’s financial services expertise.
Through the Equity Group Foundation, the initiative will provide training to value chain actors, enabling them to access financing and receive technical assistance. This support is crucial for preparing agri-processors and agri-preneurs for impact investments offered by Equity Bank.
The collaboration builds on an existing project in the DR Congo, where Equity BCDC has been operational since 2022.
The Promotion of Sustainable Food Security project aims to stimulate a sustainable agro-industrial sector, contributing to economic diversification, food and nutritional security, and employment.
To date, Equity BCDC has facilitated $10m in loans to local agri-businesses, including smallholder farmers and co-operatives, who also receive technical assistance and concessional financing.
Role of private sector
Dr Mwangi, who is also the chief executive officer of Equity Group Holdings, emphasised the critical role of the private sector in transitioning food crises towards resilient systems.
Highlighting Equity’s 40- year history of supporting African livelihoods, he noted the importance of small-scale farmers, who account for 70% of the world’s 600 million farms.
“We want to work with partners, such as WFP, to scale outputs and access to finance, facilitating investments in agricultural activities that support farmers, enhance productivity, integrate into value chains and ultimately improve their livelihoods,” Mwangi said.
He highlighted the positive impact of the Equity Group Foundation’s food and agriculture pillar, which has benefited 3.8 million farmers, including 310,000 small and medium-sized farmers.
“The Covid-19 pandemic underscored the need to diversify food sources for nutrition and job creation and to include the most vulnerable in scaling up agricultural production,” Mwangi explained.
Equity Bank’s affordable loans to food value chain businesses are made in partnership with impact investors, such as IFAD and 16 development finance institutions.
Root causes of hunger
Technology partners, such as Hewlett Packard, Microsoft, and the Bill and Melinda Gates Foundation support technology solutions enabling small-scale farmers to formalise their operations.
McCain praised the partnership’s potential to address the root causes of hunger.
“By empowering farmers with the tools and resources they need to thrive, we can create a ripple effect of prosperity that strengthens long-term food security for the whole community,” McCain stated.
The agreement also includes efforts to educate farmers on climate resilience and regenerative agriculture, while providing financial management training to navigate the cyclical nature of agriculture.
LEAD PHOTO CAPTION: Dr Mwangi and McCain signing the agreement in Rome.
