Rwanda is mobilizing $21 million to expand access to finance for farmers’ organizations and smallholder farmers under a new partnership between the International Fund for Agricultural Development (IFAD), Bank of Kigali and Aceli Africa.

The agreement, signed on September 4 during the Africa Food Systems Forum in Kigali, brings together $12 million in financing from IFAD and a further $9 million in co-financing from Bank of Kigali. The initiative is being implemented through the Farmers’ Organizations Financing Programme – Rwanda (FOFP-R).

The IFAD package consists of a $9 million loan, a $1.8 million grant to support risk-sharing mechanisms and a $1.2 million grant for technical assistance. The latter will help farmers’ organizations strengthen governance, financial management and digital capabilities while supporting Bank of Kigali in developing tools to serve the sector more effectively.

The programme is expected to strengthen around 215 farmers’ organizations, with about 172 expected to receive financing. More than 35,000 smallholder farmers are expected to benefit, with a particular focus on women and young people.

The initiative will target key agricultural value chains, including maize, rice, cassava, dairy and horticulture.

The financing comes as limited access to credit remains a major constraint for agricultural businesses and farmers’ organizations in Rwanda. The programme is designed to reduce the risks faced by commercial lenders and make farmer organizations more financially viable borrowers.

For Bank of Kigali, the partnership represents an effort to combine financing with technical support, helping agricultural organizations improve their financial systems and governance while creating conditions for greater private-sector participation.

The programme also includes support from the Global Agriculture and Food Security Program. A $6 million allocation through its Business Investment Financing Track is expected to help unlock a further $15 million from IFAD, Bank of Kigali and Aceli Africa.

Agriculture remains a major part of Rwanda’s economy and rural livelihoods. By improving access to capital for farmer organizations, the new financing mechanism aims to increase agricultural productivity, strengthen resilience and attract additional investment into the country’s food and agriculture sector.

The agreement highlights Rwanda’s growing use of blended finance combining concessional funding, commercial capital, risk-sharing and technical assistance to address financing gaps that traditional bank lending has struggled to fill.