More than 13 million smallholder farmers in Ethiopia stand to benefit from a US$305.7 million programme that aims to improve and diversify incomes through access to financial services.
This follows the signing of a financial agreement between the Ethiopian government and the UN’s International Fund for Agricultural Development (IFAD) under the Rural Financial Intermediation Programme III.
According to Ulaç Demirag, IFAD country director for Ethiopia, the programme will provide financial products and services to rural people in the least developed areas – tailored to the needs of the most vulnerable (particularly women and the youth) – in a bid to promote poverty reduction and livelihood risk mitigation.
‘It will strengthen the capacity of the rural finance institutions to deliver an expanded range of financial products and services to a large number of rural people,’ IFAD states on its website. ‘It will also support the uptake of these products by rural savings and credit co-operatives and microfinance institutions through financial literacy training, [and it will] develop insurance products through the rural finance institutions to allow smallholder farmers to mitigate the risks related to climate change.’
The funding includes US$51.9 million from the Ethiopian government, as well as a US$35.1 million grant and US$4.9 million loan from IFAD, with the remainder comprising co-financing from international development partners and national financial institutions.
