Addressing Africa’s $65bn agri-financing gap

As the short rains grace Kenya this April, there is a surge in demand for financing among agri-SMEs. The need for liquidity is vital for buyers looking to secure agricultural products like maize at favorable prices. Jonathan Tseelon, the CEO of Avenews, shares insights on addressing these challenges. Tseelon highlights the seasonal nature of agriculture, noting that the current increase in supply has led to declining prices. Buyers are keen on locking in stock at lower prices to capitalize on future price hikes. Avenews steps in to alleviate liquidity constraints for businesses, enabling them to deploy capital efficiently across operations, including procurement, logistics, and transportation. By optimizing cash flow, Avenews aims to enhance profitability and sustainability within the agricultural sector. Tseelon emphasizes the importance of collaboration among investors, government agencies, and local farmers to bolster agri-financing. Despite agriculture contributing 35% to Kenya's GDP, only 4% of financing reaches agri-businesses. Avenews is fostering partnerships to inject capital into the supply chain, enhancing stability and efficiency. The company's approach involves targeting the upper levels of the supply chain to benefit farmers indirectly. By empowering buyers and sellers with working capital, Avenews enables them to transact with a broader network of farmers, offering better prices and payment terms. Tseelon underscores that while their funding may not reach farmers directly, it ultimately supports the agricultural community through enhanced market dynamics. Avenews implements agri-buyer-supplier financing models to ensure that funds are channeled towards farmer-related transactions, promoting accountability and transparency. With an investment commitment of 2.5 billion Kenyan shillings, Avenews is optimistic about the Kenyan market's potential. The company aims to cultivate long-term relationships with clients and contribute to narrowing the $65 billion agri-financing gap in the local economy. By playing their part in bridging this financial divide, Avenews seeks to drive sustainable growth and prosperity within the agricultural sector.