Peasant farmers in Africa will no longer operate using the silo model or remain in financial exclusion as the MasterCard Foundation has launched a US$50 million challenge fund that will enable them start businesses or expand financial services in rural areas of Sub-Saharan Africa.
The MasterCard Foundation Fund for Rural Prosperity will support innovative ideas that have the potential to grow to scale and also have a deep social impact on the lives of rural people living in poverty throughout Sub-Saharan Africa.
In this regard $15 million will go towards innovation and will support the development of ideas for new products, services or processes that increase access to finance for the rural poor while a further $35 million will be used for scaling the most promising ideas or pilots that have the potential to drive financial inclusion for smallholder farmers in new geographic areas.
“Over the last decade, many countries in Sub-Saharan Africa have enjoyed substantial economic growth but much of this growth has not benefitted the rural poor, especially smallholder farmers who are mostly women and who depend on subsistence agriculture for their livelihoods,” said Reeta Roy, President and CEO of The MasterCard Foundation.
“This new Fund will stimulate private sector organizations to provide affordable and accessible savings, credit and insurance products. These services are essential to enable African farmers to increase productivity and incomes and, ultimately, grow rural economies.”
The majority of rural households in Sub-Saharan Africa remain financially excluded. Over 70 percent of these families derive a large portion of their income from agricultural activities. Many financial service providers lack the knowledge and capacity to develop appropriate products and services that would enable the rural poor and smallholder farmers to become financially included.
The MasterCard Foundation Fund for Rural Prosperity will be managed by KPMG International Advisory Services. Initialapplications for innovation proposals will be accepted from January 20, 2015 to March 20, 2015 for projects in 24 countries
Later in the year, applicants will have the opportunity to submit proposals for scaling business ideas, products or services in eight countries (Côte d’Ivoire, Ghana, Kenya, Mozambique, Senegal, Tanzania, Uganda and Zambia). More information, including application forms, guidance notes and details on eligible countries are on the website: www.frp.org