The AFC Land and Development Bank of Zimbabwe Limited (AFC Land Bank) in partnership with the Food and Agriculture Organization of the United Nations (FAO) and the Government of Zimbabwe rolled out a new loan management and e-voucher system to support agriculture in the country.
The system was developed through funding from the African Development Bank (AfDB) under the FAO managed Zimbabwe Emergency Food Production Project (ZEFPP), to help AFC Land Bank and the Government of Zimbabwe to improve the availability of certified seeds and fertilizer using ICT-based platforms and existing private sector-based distribution channels.
The ZEFPP project was developed under the African Emergency Food Production Facility (AEFPF), a rapid response framework by AfDB to address food security and disruption of the supply of critical inputs for food production arising from the war in Ukraine, climate change and COVID-19.
In Zimbabwe the project is being implemented at community and national levels to support farmers and the government to raise food production in the short- term and build food security resilience over the medium to long term. The main objective of the project is to increase cereal and oil seed production, fertilizer distribution and policy support to drive food security and build the resilience of farmers.
As part of its contract with FAO, AFC Land Bank was supported in establishing a new loan management and e-voucher system.
Speaking at the launch event for the new system Deputy FAO Representative in Eswatini, Lesotho and Zimbabwe, Louis Muhigirwa, stated that FAO is dedicated to co-operating with the AFC and the Government of Zimbabwe to promote the agricultural industry and improve food security in the country.
“FAO has been supporting Zimbabwean agriculture since 1984 and continues to support the Government’s commitment and implementation of agriculture and trade policy reforms that create enabling environment to make agrifood systems more inclusive, resilient and sustainable,” said Louis Muhigirwa.
In May 2023 FAO officialized the partnership agreement with AFC Land Bank focusing on the promotion of innovative financing mechanisms for improved access to inputs through the implementation of a seed revolving fund.
This was to help organize agriculture systems that would enable the Ministry of Agriculture to achieve its main objectives through reaching out to farmers with limited resources and those that lack access to affordable finance to support effective crop production.
“The new loan management and e-voucher system is an integrated, digital platform solution that aids farmers to receive affordable finance that support production of certified seed. Private sector producers in the maize and wheat seed value chain will also benefit from this facility” said AFC Land & Development Bank Managing Director, Priscilla Munyeza.
“Re-payments (capital plus interest) by the targeted borrowers over an agreed period will go towards re-capitalization of the fund to allow it to revolve and enable more of the targeted beneficiaries to borrow,” added Priscilla Munyeza.
The revolving fund will be disbursed as loans to a total of 17 248 farmers; comprising 16 800 independent individual farmers and 224 farmer groups of a minimum of 10 members, to facilitate their access to certified seed from Private Sector seed suppliers.
About 112 farmers under private sector seed producers and 112 farmers under contractors will also receive loans under the fund to support wheat and maize seed production directly or through grower schemes and through value chain financing with off taker arrangements.
AFC Land and Development incorporated in April 2021 as part of the AFC Holdings Group which also includes the AFC Leasing Company, AFC Insurance and the AFC Commercial Bank. The AFC Land and Development, a DFI focuses on agriculture development, through provision of financial support and access to credit for all types of farmers, (A1, Communal, Resettled, Smallholder Farmers, A2 and Commercial Farmers) for both working capital and capex for agriculture infrastructure development and rehabilitation.
The FAO and AFC partnership will bring transformative change and innovation to reinforce the impact on the ground, and to contribute achieving the SDGs.
