Afghanistan – Agricultural Credit Enhancement (ACE)

Increasing Lending Throughout the Agricultural Sector

Agricultural Credit Enhancement (ACE) was a four-year USAID-funded project that started in July 2010 to establish and manage the Agricultural Development Fund (ADF), a wholesale lending institution under the Afghanistan Ministry of Agriculture, Irrigation and Livestock (MAIL). The fund made credit available to farmers and agribusiness entrepreneurs through a variety of intermediaries, in an unprecedented effort to revolutionize Afghan agriculture.

ACDI/VOCA was a core member of the ACE team under a subcontract to DAI. We provided long-term technical personnel and short-term assistance to originate loans and train Afghan personnel in implementing the agricultural lending activities drawing on our extensive experience in agricultural value chain financing. In November 2012 the ADF was formally established and the transition of the ACE-led lending activities into the new Agricultural Development Fund under MAIL began.

Significant accomplishments and milestones to included successful program start-up, establishment of the ADF, approval of $80.5 million in loans, of which $37.3 million has been disbursed by January 2014, impacting 21,531 beneficiaries. Lending to women constituted a major commitment, and during the last year, the ADF provided loans worth $1.8 million to women-led agribusinesses and female farmers under its ZAHRA financial product. The establishment and operation of the ADF, which seemed an impossible task in 2010, became a reality and ACE was recognized as a game changer, an example of smart development that is increasingly exerting a transformational effect on rural communities in one of the world's more volatile environments. The priority for 2014 was the institutional consolidation and the transition of the ADF to Afghan control.