Building linkages and business relationships between asset leasing companies and small- and medium-sized enterprises (SMEs) is one area of focus of the USAID Zambia Enterprise Development and Growth Enhanced (EDGE) Activity, implemented by ACDI/VOCA. To help these SMEs access finance, the USAID Zambia EDGE Activity works to build the ability of financial service providers to offer asset-based finance products.

Conrad Bwalya has been the owner of Bwando Farms since 2017. As an agriculture entrepreneur whose primary value chain is animal feed production, Conrad can now resume the horticulture component of his business thanks to new financing. He began his business growing a variety of vegetables, but, due to an insufficient water supply, he stopped crop production to concentrate on producing animal feed.

In April 2021, Conrad attended a business-to-business information session organized by the USAID Zambia EDGE Activity. Part of the USAID Zambia EDGE Activity’s efforts involves increasing agricultural SMEs’ access to finance by encouraging innovative arrangements and supporting behavior change in how financial service providers assess the creditworthiness of agricultural SMEs.

The USAID Zambia EDGE Activity introduces financial products proven to unlock financing for agricultural SMEs, such as asset-based financing and trade finance — both of which feature innovative approaches to assessing collateral It also builds on the 2016 Zambia Collateral Registry and its Movable Property Registration System to catalyze the growth of asset-based financing products available in Zambia. This system allows businesses to use moveable assets, such as machinery or equipment, as collateral for loans. It also offers financial service providers tools to analyze, assess, and manage the risk of moveable property, including the ability to search whether borrowers have already pledged an asset as collateral. The USAID Zambia EDGE Activity builds the capacity of these financial service providers to refresh or design and deploy tailored asset-based financing products. A business advisor network organized by the USAID Zambia EDGE Activity also offers targeted technical assistance to agricultural SMEs to increase their financial literacy and knowledge of financial products.

Ongoing business-to-business information sessions, like the one Conrad attended, create opportunities for local entrepreneurs to gain information about asset-based financing and network with like-minded partners offering innovative asset leasing products to SMEs. During his session, Conrad learned about Rent-to-Own, a pay-as-you-go equipment subsidy provider that promotes asset-based financing to SMEs based on their ability to pay back loans. Conrad decided to use the financing he received to purchase a drip irrigation kit, water tank, and electric cable to set up a water reticulation system on his farm.

One of the newly installed water points at Bwando Farms

“[The USAID Zambia EDGE Activity] created a link with Rent-to-Own and made it easier for me to get what I wanted on a repayment period that is convenient for me. In as much as we are in business, it does not mean that we have money that is just sitting by, especially when we have competing expenditures.”

-Conrad Bwalya, owner of Bwando farms and participant of the usaid zambia edge activity
A water tank purchased through RTO for Bwando Farms

With an improved water reticulation system, Conrad will be able to start growing crops again in quantities that could meet market demand and lead to more jobs being created. He plans to plough one hectare of land for crops to sell at a supermarket for ZMW 20,000 a month and three hectares of land for a cabbage crop that will bring in ZMW 50,000 quarterly. “Buying this equipment from [Rent-to-Own] will help us put systems and infrastructure to support that,” Conrad said. “And this is a big incentive for us to start off.”

Without the support of the USAID Zambia EDGE Activity, Conrad estimates an outright purchase of this equipment would have taken more time and cost him more than ZMW 100,000. Thanks to their new access to tailored financing options, Conrad and other agricultural entrepreneurs are learning how to grow and expand their SMEs in Zambia.


Learn more about the USAID Zambia Enterprise Development and Growth Enhanced (EDGE) Activity.

Learn more about our work in Zambia.

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