PRESS RELEASE: DFID purchases Nigeria's first social impact bond
Lagos, Nigeria – Propcom Mai-karfi a program of the United Kingdom’s Department for International Development (DFID) recently purchased Nigeria’s first social impact bond known as the Raise Out of Poverty Bond (ROPO), making it the first international development agency to subscribe to the bond.
The ROPO bond, issued by Babban Gona Farmer Services Limited, a portfolio company of Doreo Partners, finances the working capital requirements of smallholder farmers in Kaduna, Nigeria.
Babban Gona, an agricultural franchise developed by Doreo Partners, improves the livelihoods of smallholder farmers by franchising grass root level farmer organizations known as ‘Trust Groups.’ Trust Groups are provided a sustainable, private sector channel for cost effective delivery of enhanced agricultural technologies, credit and services that optimize yields and labor productivity, while simultaneously improving market access. In the 2012 harvest season, the best performing Babban Gona farmer produced yields that were 5 times higher than the national average. This enabled him to earn $1,350 per hectare net of his Babban Gona credit facility.
“Babban Gona offers poor farmers a way to increase incomes by making better use of their farms. We are excited to be contributing to Babban Gona’s success, and look forward to seeing more women farmers joining trust groups” says Julian Peach, Propcom Mai-Karfi Team Leader.
To learn more about the ROPO bond or to purchase, contact Doreo Partners at firstname.lastname@example.org.
About Doreo Partners
Doreo Partners is an impact investment firm with a proven track record of exclusively investing in profitable, high growth, early stage businesses that improve the livelihoods of Nigerian smallholder farmers. Doreo’s investment strategy is driven by the team’s passion to provide a private sector driven solution to Nigeria’s leading social challenge: spiraling youth unemployment. The firm developed the Babban Gona model as a mechanism to address the unemployment challenges through the agricultural sector, an engine of economic growth.
The Babban Gona franchise model overcomes a key underlying structural problem that keeps small holder Nigerian farmers poor i.e. low economies of scale. Utilizing a sustainable private sector franchise model, Babban Gona provides cost effective, end-to-end services to a network of franchise farmer groups, called “Trust Groups.” The franchise model provides the required economies of scale to efficiently deliver services to small holder farmers, such as training and development, credit, best practice agricultural input technologies and output aggregation, storage and marketing services. The organization provides low interest rates to smallholder farmers with a further reduced rate to women. Within a year, Babban Gona has scaled ten folds serving over 150 Trust Groups.
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