The 2012 report titled Catalyzing Smallholder Agricultural Finance, produced by Dalberg with support from the Citi Foundation and the Skoll Foundation, characterized the smallholder finance market and identified growth pathways to address the largely unmet demand for finance. In the years since, the smallholder finance sector has made significant strides in understanding the challenges of serving smallholders. As a result, new providers and models have entered the market, supported by new technologies and investments that are overcoming critical barriers to expanding access to finance for smallholders.
The Initiative for Smallholder Finance (ISF) was launched in 2013 and the Rural and Agricultural Finance Learning Lab for The MasterCard Foundation in 2015. The ISF’s primary role is to act as a “design catalyst” to mobilize additional financing for smallholders and seed replication of innovative models in underserved markets. The Learning Lab fosters learning and collaboration that leads to better financial solutions provided to more smallholder farmers and other rural clients.
This study represents one product of the ongoing collaboration between these initiatives, as we view the transaction-focus of the ISF and the knowledge-focus of the Learning Lab as highly complementary. Recognizing the rapid pace of change since the 2012 report, this study sets out to give a fresh look at the state of the sector and also establish a clear agenda for future investment and learning.