FAQs

Q. Does AECF fund CBOs and NGOs?

The AECF primarily supports small and growing businesses with finance and support services such as technical assistance and investment support. The AECF partners with NGOs and CBOs but does not directly fund these types of organizations.

Q. What amounts does AECF fund?

The size of AECF funding per project is as follows:

  1. Small Businesses: US$15,000 –US$100,000
  2. Growing Businesses: US$ 100,000 – US$1,500,000

Every investment made with the AECF’s funding must be matched by either an in-kind or cash  contribution from the recipient.  The requirements and ratios vary from one programme to another, and are outlined in the specific programme term sheets.

Q. Is financing purely grants?

The AECF funding instruments are:

  • Grants: Grants are used when the proposed project/business approach is particularly risky, and requires seed funding to test the concept, fund research and development (R&D), pilot test and/or cover feasibilities. Grants are disbursed in tranches on a milestone basis.
  • Interest free loans: In some cases, the grants are accompanied by interest free loans in jurisdictions where loaning and loan recovery is permitted and where repatriation of funds is legally feasible.
  • Financial Guarantees: For entities that have the potential to crowd in third party capital a zero fee financial guarantee to provide additional level of comfort to third party investors, can be provided. AECF may provide guarantees to financial institutions who have benefitted from AECF funding to mitigate against loan defaults or to incentive them to provide concessional facilities.
  • Working Capital: This will be made available to entities that have been able to grow their businesses and demonstrate the need for additional working capital. In addition, businesses that have been affected by unforeseen circumstances will also be considered for relief funding.
  • Interest Bearing Term Loans: These will be provided to businesses that demonstrate viability and the ability to repay loans from projects funded

Q. What technical assistance is provided to companies?

The key focus of the AECF’s technical assistance is to impart practical skills and advice that strengthens our investee’s operational efficiencies, enabling access to markets and building competitiveness. Our advisory services cover strategy, financial management, marketing, sales and distribution, operations, as well as environmental social and governance (ESG).

Q. What areas does The AECF support in the agribusiness sector?

Accessible Innovations for Smallholders: We invest in businesses that have the potential to reach smallholder farmers to improve agricultural productivity and increase household income and food security. We work in a wide range of value chains and production systems to increase access to better quality agricultural inputs, improved seeds varieties and livestock vaccines, introduce new farming systems and agribusiness models.

Scaling Up Innovative Businesses: We act as the missing link between agricultural research and smallholder farmers by financing the commercialization of new technologies where others will not. Key investment areas include new fertilizers, vaccines, integrated pest management, disease resistant crops and soil testing.

Post Conflict and Fragile States: Post conflict and fragile states face particular challenges, but the private sector is a key player in supporting the reconstruction of agribusinesses in these countries. With other sources of capital largely absent, the AECF provides critical funding which has been a key driver in the re-establishment of agricultural value chains in Zimbabwe, Mozambique, South Sudan, Somalia, Sierra Leone, Liberia, and Democratic Republic of Congo (DRC).

Open Data and Media to Increase Productivity: We support low-cost communication technologies and business models for information and data sharing that can reach a large audience and provide information to smallholder farmers enabling them to improve agricultural productivity and incomes.

Promoting Financial Inclusion and Mobile Finance: Improving access to finance is a priority for the AECF. We support projects that use mobile money systems, create local financing mechanisms, introduce weather-based insurance and establish credit systems. This improves agricultural productivity and household incomes. It also establishes non-collateral credit scoring for smallholders that enable them to access formal financial systems in the future.

Q. Which technologies does The AECF support in its renewable energy portfolio?

We are technology agnostic but focus our support on the manufacture and distribution of:

  1. productive use technologies including energy for agriculture, lighting, cooling, commercial and industrial use, etc.,
  2. electrical renewable and decentralised technologies including solar PV, biogas, pico-hydro, biomass technologies, electrical hybrid systems powered by a renewable energy source, and
  3. clean, cleaner and improved thermal solutions including LPG, ethanol, biogas and briquette-based applications, for domestic, social and productive uses.