Belgium-based Incofin Investment Management announced it has raised an additional $27 million for its agRIF fund, bringing the fund’s total commitments to $140 million toward its goal of $200 million.
Through its offices in Belgium, Colombia, Kenya, and Cambodia, Incofin Investment Management is manager and advisor to funds designed to invest in microfinance institutions in developing countries – providing credit, insurance and financial services to rural populations that do not typically have access to mainstream banking systems, according to the firm’s website. The firm also is open to directly investing in companies in developing nations with the dual goal of realizing both financial and social returns.
Launched in 2015, agRIF is a third-generation fund, succeeding Incofin’s Rural Fund I and Rural Impulse Fund II, with the mission to address the funding gap as it applies to smallholder farmers, a collective group that represents the majority of people living on less than $2 per day.
Like Fund I and Fund II, agRIF employs a closed-ended, leverage private equity structure to facilitate investments in financial inclusion, however, agRIF extends this model by specifically targeting investments in the agricultural sector, smallholder farmers, and micro-entrepreneurs. The fund also provides debt investments in SMEs operating in the agricultural sector and agriculturally-focused financial intermediaries.
Since the first close, agRIF has secured additional funding totaling $27 million from a range new investors including AXA Investment Managers, KBC Pensioenfonds, Korys, Invest in Visions Global Social Impact Fund, and Maatschappij voor Roerend Bezit van de Boerenbond (MRBB), bringing the fund’s total corpus to $140 million to date.
“At Incofin IM, we very much welcome the entry of new first class investors in the fund, as they enable the fund to enhance its outreach and achieve its highly relevant goals,” said Loïc De Cannière, CEO of Incofin Investment Management.
These new investors join existing initial investors in the fund that include Incofin Investment Management, the European Investment Bank (EIB), Proparco, the Swiss Investment Fund for Emerging Markets (SIFEM), the Belgische Investeringsmaatschappij voor Ontwikkelingslanden (BIO), and Volksvermogen, ACV-CSC Metea
Often sidelined by investors, smallholder farmers are estimated to number 450 million worldwide, and are the producers responsible for the majority of agricultural output in developing countries. However, due to challenges including outdated production methods and low-yielding seeds and procedures, climate change, quality issues and the degradation of natural resources, these producers are some of the most needful of funding to ensure environmental, social and supply chain sustainability and continuance.
“The development of the agri-food sector in developing countries is an important investment theme for MRBB,” says Marc Wittemans, CEO of Maatschappij voor Roerend Bezit van de Boerenbond. “MRBB is convinced of the competence and integrity of Incofin Investment Management to manage such funds and to achieve a sustainable social and financial return.”
So far, agRIF has deployed $34 million to agricultural and rural-focused institutions in the Latin American, African and Asian markets, and a final close is scheduled for June 2017.
-Lynda Kiernan
Lynda Kiernan is Editor with GAI Media and daily contributor to GAI News. If you would like to submit a contribution for consideration please contact Ms. Kiernan at lkiernan@globalaginvesting.com.