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Small Foundation is proud to have supported the 2025 State of the Sector Report — Beyond the Frontier: Decoding Viability in Smallholder Finance — developed by ISF Advisors and partners. This report advances our understanding of how smallholder finance can deliver lasting impact while building viable, resilient systems.
Drawing on new data sets and deep market analysis, the report provides evidence on the state of rural and agricultural finance, revealing an annual global smallholder finance gap of more than US$230 billion, US$59 billion of which is experienced in sub-Saharan Africa. In spite of efforts to create finance models that will reduce this gap over time, the system still needs significant attention, innovation and efforts to scale.
To reduce this finance gap and make progress towards a stronger smallholder farming sector, the report:
- Advances our knowledge base by offering a nuanced view of dynamics across seven distinct market archetypes. These archetypes are determined by the interplay between the farmers and the crops they cultivate, the business models that purchase and finance, and the enabling environment. Within each archetype there is a ‘viability frontier’ that stakeholders can work to extend.
- Encourages recognition of the role that value chain actors play in providing finance, with the analysis suggesting they can be both viable and add value as finance providers. It also recognises risks for value chain actors and for farmers.
- Underscores the intersecting challenges of finance and climate shocks, noting that even profitable models struggle to survive repeated, unpredictable crises. It calls for smart risk-sharing, deep collaboration, and long-term investment in resilience across the sector.
For Small Foundation, these insights will inform how we and our partners continue to design and deploy catalytic and investment capital, engage value-chain actors, and collaborate to strengthen market systems that work for smallholder farmers.
