Fintech platform, Kaleidofin (www.Kaleidofin.com), has closed Kenya’s first private-sector local currency securitisation in the smallholder agriculture sector, in partnership with agri-finance company Apollo Agriculture and with investment from the IDH Farmfit Fund, a blended finance impact fund, marking a significant step in developing institutional capital markets for rural lending.
This first-of-its-kind securitisation in Kenya demonstrates how structured credit markets can channel institutional capital toward smallholder finance.
The milestone transaction involved the securitisation of smallholder farmer credit for inputs with a value of KES 370 million, mobilising KES 276 million (approximately USD 2.1 million) in financing through the sale of these receivables, originated by Apollo Agriculture and covering a portfolio of 23,839 smallholder farmers, 51% of whom are women and approximately 22% first-time borrowers. The issuance was supported by an investment grade rating of BBB- from Agusto, marking a significant milestone in demonstrating the credit quality and investability of this asset class.
Structured through Kaleidofin’s ki platform, a dedicated debt capital market infrastructure, the transaction enables the conversion of granular agricultural loans into investable assets for institutional investors in local currency. Unlike traditional models that rely on rigid standardisation, the platform supports customised structuring of portfolios and risk segmentation, powered by Kaleidofin’s proprietary ki score, an AI-driven risk intelligence layer built on loan transaction, bureau and alternative data.
The structure allows originators such as Apollo Agriculture to recycle capital efficiently while aligning financing to seasonal agricultural cycles, and provides investors with improved visibility into underlying asset risk, helping reduce information asymmetry in an otherwise opaque segment.
For Apollo Agriculture, the transaction releases immediate liquidity and improves capital efficiency, enabling continued expansion of financing to smallholder farmers without increasing balance sheet leverage. In practical terms, this means Apollo can extend more loans to smallholder farmers, helping them access the seeds, fertilisers and tools they need to grow more crops and improve their livelihoods. This is made possible by Apollo’s unique credit tech stack, which allows the company to build accurate, real-time credit profiles for farmers and underwrite customers typically excluded from formal finance. Apollo’s platform combines satellite imagery of farm plots, machine learning models trained on agricultural yield patterns, and mobile-based data collection to assess creditworthiness in real time — without requiring the collateral or credit history that traditional lenders demand.
“This transaction demonstrates how innovative financial structures can unlock capital for smallholder farmers at scale,” said Roel Messie, CEO of IDH Investment Management, manager of the IDH Farmfit Fund. “Building investable opportunities in agriculture requires both capital and enabling infrastructure, and this partnership brings those elements together.”
“We designed the Kaleidofin platform to function as scalable market infrastructure for traditionally excluded customer segments such as smallholder farmers, women entrepreneurs, clean energy and small business,” said Sucharita Mukherjee, Co-founder and CEO of Kaleidofin. “By enabling customised structuring and data-driven risk insights via ki score, we are building the foundations for institutional capital to flow into sectors such as smallholder agriculture in a sustainable way.”
The transaction is expected to serve as a blueprint for similar structures across emerging markets, demonstrating how technology-enabled infrastructure and blended finance can expand access to capital for underserved borrowers while creating investable opportunities for institutional investors.
“This is a meaningful step in building efficient, scalable funding for smallholder agriculture and validates our tech-enabled business model.” said Eli Pollak, CEO of Apollo Agriculture. “By converting receivables into working capital, we are able to lower our cost of funds and expand access to affordable, local currency financing for farmers.” Financing in local currency is critical for farmers, as it protects them from the foreign exchange volatility that can dramatically increase debt repayment burdens. A lower cost of funds means Apollo can offer more affordable loan terms, reducing the financial pressure on farmers and making it more likely they can repay, reinvest in their farms, and build long-term financial resilience.
The IDH Farmfit Fund acted as anchor investor in the transaction, which represents the first step in a broader multi-year securitisation programme expected to mobilise approximately KES 2.37 billion and reach more than 130,000 farmers over time.
The transaction was supported by a broader ecosystem of partners working to develop the enabling environment for structured finance in agriculture. UK-funded specialist development agency, FSD Africa provided support across legal and regulatory structuring, investor engagement, and market development, while the UK’s flagship public markets programme, MOBILIST, contributed to tax and structuring guidance.
“This transaction showcases how well-functioning market infrastructure can catalyse institutional capital for sectors traditionally considered high-risk, like smallholder agriculture. FSD Africa’s role has been to help build the foundations — from regulatory clarity to investor confidence — that make transactions like this viable and repeatable. We see this as a blueprint for how structured finance can unlock sustainable, large-scale funding for inclusive growth across Africa,” said Dr. Evans Osano, Chief Financial Markets Officer at FSD Africa.
“By supporting FSDA to demonstrate and enable innovation like this, we aim to make it more efficient to mobilize domestic sources of capital for women’s economic empowerment,” said Mark Wensley, Senior Program Officer at the Gates Foundation.
British International Investment (BII), the UK’s development finance institution and impact investor, provided technical assistance to its investee Apollo Agriculture through BII Plus. The foundational funding strengthens its reporting and technology capabilities, enabling access to a scalable, KES-denominated funding model that significantly reduces FX risk while achieving a more efficient and sustainable cost of capital for its growing loan portfolio.
