Matching Grant Support to Enterprises
On-Farm Production Grants
i. Farmer Enterprise Groups (FEGs)
In order to overcome economies of size disadvantages it is vital to organize smallholder farmers into groups to engage in collaborative activity including production, post-harvest processing, value addition and marketing. Under this sub-component, funding will be provided to NGOs and RSPs to establish small farmers into groups within identified clusters. Thereafter matching-grants will be provided by UAP to these Farmer Enterprise Groups (FEGs) for value addition activities as described above.
Small-scale farmers will be organized and provided capacity building and enterprise development support to establish and operate FEGs on commercially viable and sustainable basis – average size of an FEG will be 15 farmers.
The project will form 3000 FEGs in collaboration with NGOs/RSPs as implementing partners, participated by 45,000 farmers, including 30% women, will be established and provided matching-grant support.
ii. Agriculture Associations and Cooperatives
The program will provide support to upscale, strengthen and build on already existing networks (such as mangos, dates and citrus) as well as clusters of ongoing FEG programs. This will be achieved by organizing the FEG clusters and other producer groups into legally registered entities and developing their managerial, organizational and representation capacities as well as enabling them to develop skills in resource mobilization.
The project will assist 100 Agriculture Associations / Farmers Cooperatives and FEG Clusters / Apex Bodies will be registered and / or scaled up, and provided matching-grant support
iii. Individual Farmers / Corporate Farming
The program will offer cost-sharing grants to assist farmers and corporate producers to develop their farms into commercially viable operations and to diversify into the high-value agriculture sectors.
Examples of potential projects include: screen houses, pack-houses, on-farm cold storages, collection centers, crop diversification, corporate farming, off-season farming, dairy farming etc.
Matching-grants support to 250 farmers will be provided in setting up and / or expanding current agribusinesses, with special focus on value-addition and innovation.
iv. Private Sector Extension Services / Research & Development
The Project will provide matching-grant support to existing private sector extension service providers, farmer associations, individuals or firms proposing to commence private sector extension services, processors, exporters, brokerage firms and lead retailers who are involved or seek to be involved in the provision of extension services to farmers as part of their business. The support will cover infrastructure development, equipment, capacity building, overheads, and other related costs incurred by the service providers in delivery of agriculture extension services.
During the life of project, 40 Horticulture & Livestock Extension Services and Research & Development projects will be supported..
Off-Farm / Enterprise Development Grants
Enterprise Development Grant would satisfy a market demand for investment finance not currently served by the formal financial sector. These grants will also result in innovation and/or diversification in secondary production or related agribusiness activity and establish linkages to small farmers for the purchase of the output of those farmers.
i. Challenge Grants
Grant assistance will be available to promote investment in the agribusiness sector for trying out innovative ideas, diversification and value addition. “Challenge Grants” could be particularly effective in stimulating employment creating opportunities and enhancing competitiveness of value chain in horticulture and livestock sub-sectors.
During life of the project, 140 Challenge Grants will be provided.
ii. Lead Company Grants
These grants will provide companies with the additional capital needed to grow and expand their enterprise. Lead grants will primarily focus on the stimulation of large-scale private sector investment in the agribusiness sector (off-farm ventures) in high potential underserved regions of the country. These grants will especially encourage “Leads” to invest in high-risk marginalized zones and integrate small farmers/producers into formal market chains. The program will target agro-processing companies with interest in innovative and market driven investment opportunities, and will specifically address mitigation of risks associated with the investment opportunties.