MICROCAPITAL BRIEF: USADF, DFC Launch African Small Business Catalyst to Support SMEs in Sub-Saharan Africa

Two institutions backed by the US government, the US African Development Foundation (USADF) and the US International Development Finance Corporation (DFC), recently announced the launch of African Small Business Catalyst (ASBC), “a business accelerator for early growth-stage small and medium-sized enterprises (SMEs) in sub-Saharan Africa.” Through April 15, 2022, SMEs in Cote d’Ivoire, Nigeria, Senegal and Uganda may apply for loans ranging from USD 100,000 to USD 1 million paired with technical assistance and grants up to USD 100,000. In future years, ASBC expects to expand to serve other countries in Africa. The program’s sectors of focus are agriculture and food security; education; healthcare; and water, sanitation and hygiene (WASH), in addition to enterprises that address climate change and gender inequality.

DFC CEO Scott Nathan said, “By partnering with USADF, DFC will be able to reach smaller companies in an earlier stage, accelerating development in industries key to Africa’s overall economic growth.” USADF CEO Travis Adkins said, “We’re excited to serve as the DFC’s preferred partner on the African Small Business Catalyst and to employ USADF’s tried and tested model of localized, African-led development that grows incomes, employment opportunities, and African SMEs into future trading partners for the United States and engines of economic growth for their nations.”

Founded in 1980, USADF provides funding, technical assistance and networking to African enterprises and entrepreneurs, particularly women and youth. It focuses on food security, energy access and boosting employment. As of 2020, USADF reported annual revenue of USD 42.7 million.

DFC was launched in 2020 to “help businesses expand into emerging markets, foster growth and improve lives in the developing world while reinforcing US foreign policy and national security interests.” The organization issues equity placements, insurance, technical assistance and research in sectors such as energy, medicine, infrastructure and technology. During 2020, DFC brought in net income of USD 232 million, closing the year with assets of USD 12 billion.

By Sheen Gupta, Research Associate

Sources and Additional Resources

USADF press release
https://www.usadf.gov/press-release/886

USADF homepage
https://www.usadf.gov/

USADF 2020 annual report
https://usadf.gov/sites/default/files/inline-files/FY2020%20Annual%20Report.pdf

DFC homepage
https://www.dfc.gov/

Previous MicroCapital article on DFC
https://www.microcapital.org/microcapital-brief-cdc-dfc-norfund-investing-95m-in-agdevco-for-agribusiness-in-sub-saharan-africa/

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