Quarterly Progress Report: Ghana Mobilizing Finance in Agriculture (MFA) Activity

The 4-year activity aims to increase the availability of commercial financing for agriculture, facilitating capital investment and promoting trade. MFA will leverage financial incentives to spur agricultural finance market behavior change and system reform, leading to more inclusive economic growth through agribusiness development. MFA was designed to expand a financial ecosystem that supports enterprises in the "missing middle" and smaller actors, including micro-enterprises and smallholders, to access finance and investment on growth-enabling terms. To unlock finance for these underserved business segments, MFA will partner with a range of financial institutions, including Rural and Community Banks (RCBs) and microfinance institutions (MFIs), providing smart incentives to reduce the cost of deal flow and stimulate portfolio expansion among MFAs target populations, including women and youth. The activity will also encourage business advisory services providers (BASPs) to support agribusinesses of all sizes, including microenterprises, to access finance and investment by providing quality transaction facilitation services. Additionally, MFA will structure strategic partnerships with a range of actors, such as corporates, anchor buyers, digital platforms, FIs, and cooperatives, to achieve scale in financing for the smallest actors, in a way that is profitable for FIs and on terms that are growth-enhancing for borrowing enterprises. MFA will address market failures limiting the growth of several agricultural value chains in Ghana, including maize, soy, groundnut, cowpea, mango, cashew, shea, and other high-value export crops. Micro, Small, Medium including Large Enterprises (M-SMiLEs) supported in the target value chains will be located in the Zone of Influence (ZoI) covering Northern Region, North East Region, Upper East Region, and Upper West Region. During the first quarter of fiscal year 2021 (Q1 2021), the MFA team laid the foundation for core technical and operational activities. The newly on-boarded MFA staff underwent training and orientation to familiarize themselves with the activity's objectives, strategies, and expected outcomes. The team also conducted a thorough review of the activity's work plan, identifying key milestones and deliverables for the quarter. The MFA team engaged with key stakeholders, including financial institutions, business advisory services providers, and government agencies, to build partnerships and establish a strong network of supporters. The team also developed a comprehensive communication strategy to ensure effective dissemination of information and updates on the activity's progress. In terms of performance, the MFA team made significant progress in mobilizing new sources of capital, expanding the supply of agricultural finance, and forming strategic partnerships to expand access to finance for the smallest actors. The team also made notable strides in leveraging strategic communications to expand agricultural financing and addressing cross-cutting priority areas, including environmental best practices, gender, and youth. Overall, the MFA activity has made a strong start in its first quarter, laying the foundation for a successful and impactful program that will contribute to the growth and development of Ghana's agricultural sector.