MESPT-Credit-05-2022: Consultancy for Development of Financial Products at Micro Enterprises Support Programme Trust (MESPT)

STRATEGY FOR FINANCIAL ACCESS AND INCLUSION

MESPT strategy for Financial Access and Inclusion was influenced by the following:

1. Changing contextual reality where limited financial investments are available for agricultural productivity, food safety, agricultural business development investments. There has been a growing miss-alignment of financing structure(s) and increased perception of associated risk. With global warming becoming a reality, we have witnessed growing investments in green transformation initiatives and investments.
2. MESPT contribution to green transformation agenda- MESPT wishes to significantly contribute to the national agenda in promoting green financing in agricultural sector. MESPT seek alignment to SDG 13 and National Government Green Economy Strategy and Implementation Plan (GESIP), Kenya Climate Smart Agriculture Strategy 2017-2026, Climate Change Act, 2016, National Climate Action Plan 2018-2022, National Climate Change Action Plan (NCCAP 2013-2017)
3. Sustainability- The need to contribute to long lasting outcomes and results. Social and Environmental sustainability, build resilience, social inclusion, and sustainable livelihoods.

RATIONALE

Promotion of financial access and inclusion within Agricultural and Green Growth sectors is a critical strategic pillar for MESPT. This pilar is delivered through Credit & Business Development Department. Key functions of the department includes (i) Development of responsive financial products to serve the target groups through identified channels; (ii) Provision of debt capital to Financial Service providers (FSPs) for on-lending to smallholder farmers(SHFs), direct lending to SMEs and Farmer co-operatives for working capital and capex investments; (iii) Provision of Capacity and Technical support to FSPs to increase scale of capital supply to SHFs, SMEs and Farmer Co-operatives; (iv) fundraising to increase scale for debt facilitation; (v) identification of mutually beneficial partnerships to further the overall mission and vision of MESPT especially in achieving increased financial access and inclusion.

To support the financial access and inclusion eco system within Agricultural and green Growth sectors, it is becoming increasingly important to address the appropriateness of financial solutions targeting the sector. We have witnessed increased funding within the SME and Agricultural sectors, however, the fund utilization has been minimal. This has been associated to compelling limiting factors such as lack of collateral, mismatch between reward to risk, high risk perception for the sector, lack of historical track record, poor record keeping, inadequate capacities of the borrowers, high cost of credit, limiting terms and conditions among others.

MESPT, through its financial access and inclusion strategy, envisages opportunities in mitigating some of the above limitations by designing and developing financial solutions that are flexible, affordable and fitting different needs agricultural and green subsectors and targeting formal and informal Financial Service Providers; MSMEs, Farmer- Co-operative Societies and smallholder farmers.

OBJECTIVES OF THE ASSIGNMENT

The objective of this consultancy is to design and formulate credit products for MESPT for Agri and Green financing, both financial and non-financial (off balance sheet) where applicable. The products should be market oriented to enable MESPT remain competitive in the marketplace whilst delivering the mandate of impact creation to the end users.

SPECIFIC OBJECTIVES

The objectives of the consultancy are to:

• Refresh financial solutions offered by MESPT in response to new financial access and inclusion strategy.
• To enhance MESPT market niche in financial access and inclusion space.
• Document internal and external feedback and develop recommendations to guide this consultancy.
• To enhance MESPT internal capacity in financial services sector.
• To embed MESPT relevance in Agricultural and Green financing.

CONSULTANT REQUIREMENTS

• Master’s degree in relevant field- (Agricultural Economics, Business Management, Strategy) and 5 years relevant technical experience (Training programs).
• In-depth knowledge and experience in Microfinance finance, Agricultural finance, Climate/Green finance, Development finance, financial inclusion, Enterprise development and/or Agricultural Value Chain Development.
• Experience in supporting a financial institution in development of AVCF models or and products.
• Experience in conducting similar tasks with reputable organizations/agencies experience of 5 years or more.
• In-depth knowledge and experience in supporting financial institutions in development of Agriculture value chain financing Products.
• Demonstrated understanding of concepts for financial and inclusive finance and value chain approaches.
• In-depth Knowledge of risk analysis and management in financial services sector.
• 3 References for similar assignment for the past 5 years, with contact details.