Savia Trade Asset Management has launched a trade finance fund for small and medium-sized agribusinesses in Africa. Savia is targeting Africa’s $100 to $150 billion trade-finance gap.
The joint venture between U.S.-based CVG Capital and Mauritius-based Ubuntu Capital wants to raise $200 million to support small farmers, cooperatives and small agribusinesses, and ultimately reach 250,000 farmers and 2,000 agribusinesses each year.
CVG Capital’s founder German Vegarra launched the fund after leaving the International Finance Corporation because “there was nothing transformational in the region reaching smallholder [farmers] and SMEs.”
The fund will rely on a blended finance model, with 80 percent allocated for short-term loans, 10 percent for equity, and 10 percent for grants.
Savia is planning 12 to 16 months of piloting to test the fund’s model.