Agribusiness in sub-Saharan Africa remains heavily reliant on integration of smallholder farmers into the value chain. These smallholder farmers present a unique opportunity and challenge compared to the agribusiness value chain found in any other region of the world. These smallholder farmers together represent a large source of raw material supply for value addition activities or for crops, vegetables and produce going direct to market. However, they are constrained by an often weak or non-existent infrastructure to allow them to access these markets.
There has been a recent shift in financing to address these infrastructural gaps, which range from physical infrastructure such as roads and bridges to a financial or technological infrastructure such as access to finance and mobile connectivity. As investors seek opportunities in this area, they not only identify strong business opportunities but also see their investments indirectly catalyse numerous other sectors. For example, a mobile payment platform that additionally offers credit facilities to smallholder farmers realises an opportunity currently not being realised in an under served market and subsequently allows the farmers receiving the credit to drive other related businesses such as agriculture input distributors. The exponential benefits of investing into agribusiness value addition activities are driving impact investors to open up to more opportunities in the space.