Source: AFC
Agricultural Finance Corporation (AFC) is a government-owned Development Finance Institution (DFI) mandated to assist in the development of agriculture and agricultural industries by issuing loans to farmers, co-operative societies, organized groups, and other persons engaged in agriculture and/or agricultural industries.
Allan Indiazi spoke to George Kubai, the AFC Managing Director on the organization’s contribution to Kenya’s agricultural transformation.
How has AFC aligned its goals and strategies with the Malabo Declaration’s commitments to transforming Africa’s agriculture?
AFC’s mandate is to support agricultural development by providing sustainable credit to both smallholders and commercial farmers. This aligns with the Malabo Declaration’s goal of increased agricultural funding. Due to the inherent risks and uncertainties of agriculture, many financial institutions avoid lending to this sector resulting in financial exclusion, particularly for youth, women, and rural populations. The Corporation’s Strategic Plan directly addresses this issue by prioritizing financial inclusion for these underserved groups.
Can you highlight specific initiatives AFC has implemented to support the financial goals outlined in the Malabo Declaration?
The Corporation has developed products utilizing alternative collateral to enhance access to credit and improve repayment rates for smallholder farmers. This includes Warehouse Receipt Finance, Asset Financing, and wholesale lending through Savings and Credit Cooperative Societies (SACCOs), Microfinance Institutions (MFIs), and anchor models. In partnership with its strategic partners, the Corporation has also conducted capacity-building initiatives to educate existing and potential clients on financial literacy, farming as a business, and related topics The Corporation has also implemented joint projects under the public private partnerships arrangements to accelerate funding in the agricultural sector.
How is AFC addressing the Malabo Declaration’s emphasis on inclusivity, particularly in supporting smallholder farmers and vulnerable groups?
AFC recognizes that equitable access to agricultural financing is essential for achieving inclusive agricultural growth, food security, and poverty reduction. The Corporation has launched programs that promote financial inclusivity within the agricultural sector through strategic collaborations. Notably, in collaboration with the African Development Bank through the Ministry of Agriculture and Livestock Development and the National treasury, the Corporation initiated the Enable Youth Program (EYP). The programme targeted graduate youth interested in agribusiness, and was grounded in the urgent need to address rising youth unemployment and underemployment in Kenya, particularly in rural areas through the provision of unsecure loans (non-collateralized), soft loan and interest free loans.
Additionally, AFC has implemented targeted financing programs that prioritize women, youth, and farmers in arid and semi-arid lands (ASALs), including the Frontier Counties Development Council (FCDC) regions. The Corporation has also partnered with development organizations such as ACDI VOCA to extend affordable credit to farmers in marginalized areas, ensuring that underserved populations are not left behind.
In line with the Malabo Declaration, the Corporation continues to champion inclusive financing as a critical lever for agricultural transformation and national development.
What financial products or services has AFC introduced to ensure smallholder farmers have better access to credit?
Among other interventions, the Corporation has introduced innovative financial products such as Warehouse Receipt Financing, a Wholesale Lending product, the Anchor Client Model, and Asset Financing—all aimed at enhancing access to credit for smallholder farmers and agribusinesses.
The Warehouse Receipt Financing enables farmers to use stored produce as collateral to access credit, allowing them to sell at favorable market prices rather than immediately after harvest. The Wholesale Lending Product targets cooperatives, SACCOs, and other financial intermediaries by extending bulk credit facilities, which are then on-lent to smallholder farmers—enhancing outreach and impact. Through the Anchor Client Model, AFC partners with large-scale aggregators or value chain actors who act as guarantors or off-takers, reducing lending risks while ensuring market access for smallholders. Additionally, Asset Financing has been developed to help farmers acquire essential agricultural machinery and equipment such as irrigation kits, tractors, and milk coolers, promoting mechanization and productivity with manageable repayment terms.
How else is AFC leveraging technology and innovation to improve access to agricultural finance, in line with the Malabo Declaration’s objectives?
AFC has strategically integrated technological innovations and digital solutions to enhance agricultural finance accessibility, streamline processes, and promote sustainable agricultural growth in line with the Malabo Declaration’s goals. This includes automation of the Loan Origination and Appraisal System (LOAS) – AFC has digitized loan processing, enabling faster approvals, seamless credit assessments, and real-time integration with banking systems. The Corporation has also Customized Credit Scoring Models which incorporates risk assessment, agro-ecological conditions, farm capacity, and alternative financial data, ensuring more inclusive financing for smallholder farmers.
Further, there is alternative Financial Delivery Channels – farmers access loans through USSD, mobile apps, and with automated repayments reducing reliance on physical branch visits. AFC also collaborates with FinTechs to enhance risk analytics and introduce technology-based solutions to increase impact and outreach.
What risk management strategies has AFC adopted to safeguard agricultural investments and support farmers’ resilience against climate change and market fluctuations?
AFC has implemented a comprehensive set of risk management strategies to safeguard agricultural investments and enhance farmers’ resilience against climate change and market fluctuations. These strategies include diversification of financial products, climate-smart agricultural loans and market linkages and value chain development.
How is AFC aligning with the new Kampala Declaration?
The Agricultural Finance Corporation (AFC) is actively aligning with the implementation of the Kampala Declaration through its Strategic Plan 2023–2027. The Strategic Plan was formulated in consideration of key continental frameworks such as the African Union’s Agenda 2063 and the Malabo Declaration, which form the foundation of the Kampala Declaration. Notably, the first Strategic Objective of the plan—“Driving Sustainable Agri-food Systems”—directly supports the core commitments of the Kampala Declaration, particularly in promoting food security, climate resilience, inclusive growth, and access to affordable agricultural financing. Through ongoing implementation of this objective, AFC is committed to fostering transformative, inclusive, and sustainable agricultural development in Kenya and beyond.
The Malabo Declaration reaffirmed Africa’s commitment to agriculture-led growth for food security and shared prosperity. The subsequent Kampala Declaration sought to strengthen these aspirations, especially in light of emerging threats such as climate change, disease outbreaks and economic shocks. Significant financial and institutional gaps, however, persist in realizing the vision of agricultural transformation. How can AFC help in ensuring the full implementation of the Malabo and Kampala commitments?
AFC is uniquely positioned to respond to the persistent gaps and advance Kenya’s alignment with the Malabo and Kampala Declarations. To facilitate access to agricultural credit, particularly for smallholders and medium-scale farmers, AFC is implementing key transformative interventions which include enhancing efficiency and impact of agricultural financing, catalyzing private sector participation and operationalizing inclusive and targeted finance windows. The Corporation is also shifting toward results-based financing, where every investment is tied to clear development goals in food security, climate resilience, and competitiveness.
In line with the Kampala Declaration’s call for enabling policy environments, the Corporation is collaborating with the government and development partners to de-risk agricultural investments. Through blended finance structures and risk-sharing facilities, such as Enable Youth Kenya, AFC is crowding in local private capital, predominantly in high-impact areas like agro-processing, mechanization and irrigation. To support inclusive growth, AFC has launched specialized lending windows tailored for women, youth, agri-SMEs, and smallholders. In pursuit of transparency and accountability and inclusion AFC is adopting digital platforms, early warning systems, geospatial analytics and data-driven decision-making tools to improve credit targeting, risk profiling, and loan performance.
Financing Agri-food Systems Sustainably Summit has been hailed as an important platform in rallying African countries and private sector towards the achievement of the Kampala Declaration. What is AFC’s role in FINAS 2025?
The Summit focuses on rethinking sustainable financing for Africa’s food systems, addressing challenges like limited access to finance for smallholder farmers and agri-SMEs. As Kenya’s leading DFI in the Agricultural Development space, and one of the oldest in the region (est 1933), we pride ourselves in being the market maker when it comes to agri lending.
The corporation’s alignment with the Summit is evident in our commitment to providing innovative and inclusive financing solutions for agriculture. AFC’s participation underscores its dedication to fostering partnerships, leveraging technology, and de-risking investments in agriculture to enhance productivity and sustainability. The summit will also explore areas like climate adaptation, digital transformation, and policy frameworks, which align closely with AFC’s mission to support agricultural value chains and improve food security. It’s a great opportunity for us and other like-minded partners to showcase solutions and collaborate with other stakeholders to shape the future of sustainable agri-food financing. AFC is a key partner and will be featured heavily on the Summit’s program including hosting a dedicated breakout session.