The African Development Bank (AfDB) has approved a $9million equity investment in the Fund for Agricultural Finance in Nigeria (FAFIN) to provide expansion capital to agric small and medium-sized enterprises (SMEs), according to a statement issued by continental lender yesterday.
The statement said FAFIN is a first-generation private equity fund that provides financial, capacity-building and technical assistance to commercially viable SMEs in the Nigerian agribusiness sector. It said FAFIN used a unique value chain-centric approach, a combination of equity, quasi-equity and convertible loan instruments to provide loan for SMEs.
According to it, FAFIN implements its strategy and constructs its portfolio through a bifocal lens consisting of the twin objectives of competitive financial returns and measurable positive social impact.
The Fund is jointly sponsored by the German KfW Development Bank and the Government of Nigeria, through the Federal Ministry of Agriculture and Rural Development (FMARD).