Opportunity initially launched an agricultural finance pilot in 2005 in Malawi. Today, we are providing a full range of financial services
to smallholder farmers across Ghana, Malawi, Mozambique, Rwanda and Uganda and are preparing to replicate the initiative in Tanzania, Kenya and the Democratic Republic of the Congo.
EXECUTIVE SUMMARY
Africa is home to a quarter of the world’s farmland, yet it generates only 10 percent of all crops produced globally.1 Opportunity International’s (“Opportunity”) own experience in Africa indicates that most farmers are operating at just 40 percent of their potential capacity.
Crop production remains low in Africa because the majority of food producers are smallholder farmers who lack access to financial services, farming inputs (including improved seeds and fertilizers), agricultural training and fair crop markets to optimize their productivity and increase their earnings. Low crop yields keep farmers’ incomes small, preventing them from providing collateral to a financial institution so they
can receive a loan, purchase inputs and transition from subsistence farming to economically and commercially
active farming.
Without financial access and sufficient yearly earnings, many farmers also lose up to 50 percent of their annual potential income because they must gain quick access to cash to afford household expenses all year. In the time leading up to harvest, farmers often experience a “hungry season” in which they struggle to pay for family necessities including food. To make ends meet until their crops are ready to be sold, many farmers are forced to borrow from unregulated moneylenders at exorbitant interest rates or sell their future harvest early at a reduced rate to receive the cash they need to buy clothes, feed their children and survive. To address these challenges,
Opportunity’s agricultural finance initiative provides smallscale farmers with all of the tools they need – including a full range of financial services – to sustainably improve their crop yields, reduce hunger and food insecurity and meet the growing worldwide demand for food.
1 Jayaram, K., Riese, J. & Sanghvi, S. (2010). Agriculture: abundant opportunities. McKinsey Quarterly, Summer 2010.
2 United Nations Development Program (2012). Africa human development report: toward a food secure future.
3 Hazell, P., Poulton, C., Wiggins, S., & Dorward, A. (2007). The future of small farms for poverty reduction and growth.
International Food Policy Research Institute.
4 Isa, M. (2013, May 6). Food production faltering in sub-Saharan Africa. Business Day Live.
