A US$100 million fund is now available to Africa’s small-scale farmers and small to medium sized agribusinesses – a move that will address major problems in the continent arising from the global food crisis.

Standard Bank and the Alliance for a Green Revolution in Africa (AGRA) created the fund which will give loan opportunities to Ghana, Mozambique, Tanzania and Uganda smallholder farmers, previously considered too risky.

Lack of access to finance has prevented farmers from investing in basic inputs, resulting in their yields remaining one-quarter the global average. Agribusinesses too lack commercial financing to establish businesses that could increase the continent’s food production and enable farmers earn a decent profit.

The global food crisis has caused inflation, food shortages and trade imbalances Africa, and the innovative fund is expected to increase the small-scale farmer's ability to achieve food security.

During the signing of the MOU in Accra, Jacko Maree, Standard Bank’s Group CEO said: "As a leading emerging markets bank, our goal is to perform a transformative role in the continent’s agricultural sector…..Transforming small scale farmers into medium-sized enterprises is essential to address the food security and to stimulate economic growth."

Agriculture is the backbone of economies across sub-Saharan Africa, yet it receives only 1% of total commercial lending, the bulk which goes to large-scale operations, leaving small-scale farmers in a lurch.