FAST IN EAST AFRICA: FACILITATING ACCESS TO FINANCE IN TANZANIA

FAST, in partnership with The MasterCard Foundation, is laying the groundwork for its second Tanzanian FAST Financial Fair (FFF) for agricultural SMEs and Financial Service Providers. The precursor to this event was a financial literacy training workshop, held for 20 agricultural SMEs which greatly contribued to the strength financial management knowledge of the participants. This session was particularly engaging due to the customization of the FAST Financial Literacy Toolbox (FTBLX), which were translated to Swahili and adapted with local examples, including an addition of a debt management module.

The FFF consists of one-on-one meetings between Financial Service Providers and local SMEs, closing a finance gap which is particularly problematic for agricultural SMEs in the country due a lack of opportunity in investment and financial management education. 

Although the smallholder agricultural sector is increasing in importance and there is a high demand for financing, many banks are still unwilling to take the risk of investing in the agriculture sector and even in financially audited agricultural SMEs, as very few have reached sufficient business maturity. Specifically, based on FAST's analysis of the pre-selected SMEs, it is difficult for the SMEs to define their company's value and financial projections in a standardized way usable by banks, therefore they often have trouble efficiently allocating the funds given to them. For this reason, on-going training and coaching is a key component of the FFF process.

The first step of the FFF was the FLTBX Training of Trainers (ToT) in Dar es Salaam on October 2014 (pictured right). Now trained, the trainers are equipped to strengthen financial management capabilities amongst participating SMEs and prepare them for the upcoming FFF using the FLTBX (SMEs pictured below, FLTBX certified). These tools were translated to Swahili, the business language of Tanzania, and adapted with local examples, including an addition of a debt management module. This is an area particularly important to manage within the agricultural sector due to different reasons such as the high prices of inputs, the current deficient debt financing management practices, the need of finance for business development. When the specific financial, business and investment management obstacles of agricultural SMEs are addressed, the SMEs would see the full benefits of this innovative FFF process with an improved credit readiness level to successfully access finance. Additionally, the training of trainers would also increase the on-the ground network of consultants knowledgeable in the FLBTX, thus increasing FAST's ability to support continued presence within Tanzania.

Building upon its prior experience in East Africa, FAST considers that this FFF has great potential, and willcontinue to pave the way for new innovative ways for smallholder farmers to access finance in Tanzania. The coming FFF to be held the 24th and 25th of February in Tanzania is part of FAST's ongoing presence in the region. Following this process and systematization of results, FAST will continue to facilitate impact investment in Tanzania, as well as in other parts of East Africa, to increase socially-oriented investors' role in, promoting the continued development and growth of agricultural farmers, while supporting the adoption of sustainable practices. 

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