IFC Supports $42M to Empower Women and MSMEs in Romania's Agriculture Sector

The financing aims to tackle the financing gap for micro, small, and medium-sized enterprises (MSMEs) in Romania’s agricultural sector, with a special focus on women-owned businesses.

The International Finance Corporation (IFC) has committed a substantial $42 million equivalent debt financing package to Agricover Credit IFN, Romania’s largest non-banking financial institution dedicated to supporting agriculture. The financing aims to tackle the financing gap for micro, small, and medium-sized enterprises (MSMEs) in Romania’s agricultural sector, with a special focus on women-owned businesses.

A significant portion of this package, at least 50 percent, is specifically earmarked for women-owned MSMEs in the agriculture industry. This initiative directly addresses the unique challenges women face when trying to access financial resources for their farms or agri-businesses. With this investment, IFC hopes to play a crucial role in closing the gender-based financing gap and fostering an environment of greater economic equality in Romania’s rural communities.

Mobilizing Global Support for Agriculture Financing

As part of the financing package, IFC successfully mobilized an additional EUR 20 million under its B Loan Program. The funds were raised from two key impact investors: the Amsterdam-based ILX Fund, a global development finance asset manager focused on Sustainable Development Goals (SDGs), and German impact investor Invest in Visions. This collaboration demonstrates the growing global interest in supporting the agricultural sector, particularly in Romania, which has a strategic agricultural market and plays a significant role in the European economy.

The agricultural industry is critical to Romania, accounting for 5 percent of the nation’s GDP and employing 30 percent of the workforce. This contrasts sharply with the European Union’s average, where agriculture only represents 5 percent of employment. Romania’s agricultural land base is extensive, ranking as the sixth-largest arable land area in the EU. The country is also a leading global producer of wheat and corn, showcasing its agricultural potential. Despite this, the sector faces significant challenges, including low productivity, structural weaknesses, and limited access to financing. These issues are exacerbated in rural communities and for women farmers, who often face even greater difficulties in securing the necessary funds to sustain and grow their operations.

A Partnership to Promote Gender Equality and Sustainable Development

In a statement about the new financing, Serhan Hacisuleyman, CEO of Agricover Credit, expressed his enthusiasm about the opportunity to continue the long-standing partnership with IFC. “We are pleased to have the opportunity to extend our decade-long collaboration with IFC. This occasion marks the introduction of an innovative syndicated product that not only provides essential funding but also aids in diversifying our lender base,” Hacisuleyman said. He emphasized the shared commitment between Agricover Credit and IFC to foster sustainability through inclusion programs, particularly initiatives that promote gender equality and intergenerational renewal in Romania’s agricultural sector.

The partnership between IFC and Agricover Credit aims to empower small-scale farmers, including women, to invest in essential agricultural equipment and working capital. This financing will help mitigate the impact of global challenges, such as geopolitical tensions and market volatility, which have disrupted regional agricultural markets and increased lenders' risk aversion. By supporting long-term loans, this project ensures that farmers will have the financial resilience to continue operations despite economic uncertainty.

Addressing Gender Inequality in Access to Finance

One of the core elements of the financing package is the involvement of the Women Entrepreneurs Opportunity Facility (WEOF). This initiative, which is a part of IFC’s Banking on Women Program and was co-founded with Goldman Sachs’ 10,000 Women initiative, provides performance-based incentives to financial institutions. These incentives are designed to encourage more lending to women entrepreneurs, particularly in sectors where they have traditionally been underrepresented, such as agriculture.

Charlotte Keenan, Global Head of Goldman Sachs 10,000 Women, commented on the importance of the partnership, saying, "Goldman Sachs 10,000 Women is proud to partner with IFC to provide a performance-based incentive as part of this significant investment in Agricover Credit. With its focus on women-owned agri-businesses, this project exemplifies WEOF's mission to address the financing gap faced by women entrepreneurs. By providing access to capital, this partnership will enable these businesses to thrive, contributing to Romania’s economic growth.”

The WEOF facility, which is the first of its kind, aims to create a sustainable and scalable model for supporting women entrepreneurs around the world. Through this partnership, IFC and Goldman Sachs seek to increase the representation of women in agriculture and other traditionally male-dominated sectors, helping these women to overcome the financial barriers they face and unlock their full business potential.

A Long-Term Vision for Romania's Agricultural Future

Despite the considerable challenges faced by the agricultural sector, this new investment is a step forward in creating a more inclusive and sustainable future for Romania's farmers and agri-businesses. The collaboration between IFC, Agricover Credit, and its global partners will provide vital resources to help Romanian farmers thrive, improve their productivity, and weather future challenges with greater resilience.

The support for women-owned agri-businesses, in particular, holds the potential to significantly impact Romania’s agricultural landscape. With this financing, women farmers will gain the necessary tools to modernize their operations, diversify their income sources, and contribute more substantially to the country’s agricultural output.

As Etleva Koka, IFC’s Manager for Financial Institutions in Europe, put it: “IFC’s investment will address one of Romania’s largest funding gaps, improving access to finance for farmers and especially women, who face greater challenges in securing resources. This partnership will empower farmers to invest in essential equipment and working capital, helping them remain resilient in the face of global challenges.”

This innovative and impactful partnership is poised to have a lasting effect on Romania’s agricultural sector, and its success will serve as a model for other nations seeking to support women entrepreneurs and create more sustainable, inclusive economies.