Farmers, agribusinesses report growth under EU-backed financing through local banks

Nambeye said weather changes and power shortages threatened the farm’s survival until it accessed financing through Zanaco, one of the local banks partnering in the facility.

“We saw an advert on social media and approached Zanaco which explained the programme to us. After getting the loan, we were able to invest in an irrigation system and we are now making un-interrupted progress,” she said.

In Kabwe, Amadeus International managing director Rajendra Patel said access to financing was previously a challenge but through ZAVCF and Zanaco, the company was able to install additional irrigation infrastructure and expand cultivated land.

“The funding helped us introduce more irrigation, expand hectares and even do double cropping on the same land. It also protects us from droughts and improves our revenues,” Patel said.

Through the ZAVCF partnership with local Zambian banks, commercial farms have also benefited from the facility’s provision of foreign-currency loans, which are suited to export-based operations.

Galaunia Farm managing director Nigel Lacey said getting loans in US dollars aligns better with farms that sell their products in international markets or need to import inputs or equipment as they can pay in foreign currency.

“Borrowing in dollars at a viable interest rate allows us to remain profitable and continue supporting our workers and the surrounding community,” he said.

The Zambia Agriculture Value Chain Facility was launched in 2021 as part of the EU’s Global Gateway target to support sustainable development and economic transformation through targeted investments.

Through the lending framework, the European Investment Bank channels capital to local banks, including Zanaco, First Capital Bank Zambia and the Zambia Industrial Commercial Bank, who then lend to farmers and agribusinesses that understand local market conditions.

Since the programme’s launch, multiple credit lines have been mobilised, including €15 million extended to Zanaco in 2021, €10 million to First Capital Bank in 2023 and a €15 million facility signed with Zambia Industrial Commercial Bank in 2025 to support private sector agricultural investment.

The Zanaco credit line is already fully utilised with strong tangible impact being witnessed on the ground. This also shows the big need for affordable financing in the market.

The ZAVCF combines long-term financing, risk-sharing guarantees backed by the European Union and technical assistance to strengthen both banks and borrowers.

By sharing credit risk with local banks, the programme acts as a safety net, enabling financial institutions to extend loans to farmers who previously lacked sufficient collateral or smaller sized companies that were previously seen as too risky to support.

Beyond financing, head of the European Investment Bank’s Hub for Southern Africa, Jim Hodges said the facility provides training and technical assistance to farmers to improve productivity, environmental sustainability and business management.

“We provide financing and technical assistance to private sector development projects in Zambia, which support the national key priorities as well as aligning to the EU objectives,” said Hodges.

Meanwhile, the European Union ambassador to Zambia and COMESA Karolina Stasiak said the EU will continue supporting Zambia’s ambition to transform the agriculture sector into a thriving sector that creates jobs and boosts growth for the country.

“Our actions focus primarily on supporting small-scale farmers and fishermen to modernise their farming practices and to connect them with businesses.”

“This includes promoting new investments in promising agricultural value chains. This includes also facilitating access to finance, to capacity building, and to inputs,” stated Stasiak.