The Global Agriculture and Food Security Program (GAFSP) has launched a new $75 million Business Investment Financing Track (BIFT) to accelerate financial innovations supporting smallholder farmers and micro, small and medium-sized enterprises (MSMEs) in the agriculture sector. This financing window is designed to foster inclusive, climate-smart and nutritious food systems, primarily in low-income and vulnerable countries.
The launch of BIFT comes at a critical time when the global food system faces overlapping challenges, including climate change-induced weather events and disruptions in supply chains. These challenges have exacerbated food insecurity, making the need for innovative financial mechanisms to support underserved agricultural entrepreneurs more pressing than ever. The BIFT aims to de-risk private investments, making it easier for financial institutions to mobilise capital for high-potential yet traditionally neglected segments of the agri-food system.
GAFSP has a history of providing much-needed financial support in the agricultural sector. Since its establishment by the G20 in 2010 in response to the 2007-2008 food price crisis, GAFSP has mobilised over $2.5 billion in donor resources for global food and nutrition security. Through this new financial window, the program seeks to incentivise investments in underserved value chains, which have been historically overlooked by private investors due to perceived risks or modest returns.
Blended finance for systemic change
A key feature of the BIFT is its focus on blended finance solutions, which combine grants, concessional debt and equity to attract private capital. The aim is to build on strategic public investments in nutritious food value chains, leverage non-governmental organisation involvement and mobilise resources from a broad range of investors, including impact investors, asset managers and banks. These blended finance approaches help lower the risk profile of investments, making traditionally unattractive markets more appealing to private sector investors.
James Catto, Chair of the GAFSP Steering Committee, highlighted the need for this innovative approach, stating, “High-potential agri-MSMEs in lower-income countries are being left behind by financial markets and have no way of breaking into regional or global markets. The BIFT will deploy systemic solutions tailored to the needs of small producers and early-stage agribusinesses so they can achieve scale and tap into conventional financing.”
The BIFT pilot program will run through June 2026, in collaboration with key development partners, including the African Development Bank, Asian Development Bank, International Finance Corporation, IDB Invest and the United Nations’ International Fund for Agricultural Development (IFAD). These partnerships are crucial to expanding the reach and effectiveness of the BIFT by targeting smallholder farmers, producer organizations, MSMEs and agribusiness start-ups that focus on nutritious food production and marketing.
By focusing on these traditionally underserved segments, BIFT aims to close the financing gap that has long limited the agri-food sector in low-income countries. “BIFT is a significant step forward in addressing the smallholder financing gap by unlocking much-needed private capital,” said Felipe Dizon, Acting Program Manager of the GAFSP Fund at the World Bank. He emphasised that the financing window is not just about financing projects but about working with a wide range of stakeholders, including governments and civil society, to create sustainable solutions that enhance food security, climate resilience and economic opportunities.
BIFT as a path to sustainable food systems
The BIFT’s ambition aligns with GAFSP’s broader mission to transform food systems in low-income countries by supporting agricultural productivity and boosting food and nutrition security. Over the past decade, GAFSP has built a global portfolio of 300 projects that have benefitted over 20 million people through public and private sector investments.
The introduction of BIFT marks a new chapter in GAFSP’s efforts to unlock the potential of agri-food systems in underserved regions. By incentivising public-private partnerships and fostering financial innovation, the $75 million financing window promises to create a ripple effect, enhancing the resilience of food systems in some of the world’s most vulnerable areas.