Background

UNCDF makes public and private finance work for the poor in the world's 47 least developed countries. With its capital mandate and instruments, UNCDF offers "last mile" finance models that unlock public and private resources, especially at the domestic level, to reduce poverty and support local economic development. UNCDF's financing models work through two channels: financial inclusion that expands the opportunities for individuals, households, and small businesses to participate in the local economy, providing them with the tools they need to climb out of poverty and manage their financial lives; and by showing how localized investments — through fiscal decentralization, innovative municipal finance, and structured project finance — can drive public and private funding that underpins local economic expansion and sustainable development. By strengthening how finance works for poor people at the household, small enterprise, and local infrastructure levels, UNCDF contributes to SDG 1 on eradicating poverty and SDG 17 on the means of implementation. By identifying those market segments where innovative financing models can have transformational impact in helping to reach the last mile and address exclusion and inequalities of access, UNCDF contributes to a number of different SDGs.

UNCDF in partnership with the European Union under the 11th EDF and the Government of Uganda under the Office of the Prime Minister is implementing a four year Programme referred to as the Development Initiative for Northern Uganda (DINU). The general objective of the Programme is to consolidate stability in Northern Uganda, eradicate poverty and under-nutrition and strengthen the foundations for sustainable and inclusive socio-economic development. The programme will benefit 33 districts in Northern Uganda with a total population of 7 million. With respect to this call, UNCDF is focusing on improving access to finance for SMEs engaged in agricultural value addition through a dedicated facility for business development services and blended finance.

Support to Agricultural Revitalization and Transformation (START) Funding Facility The START funding facility is designed to support the implementation of DINU food security and nutrition component. The Facility is intended to offer access to affordable medium-term finance for agricultural value adding projects in Northern Uganda through provision of Business Development Services and seed capital in the form of concessional loans, grants and partial guarantees. START is structured as a blended facility providing a customized mix of Business Development Services, project development and structuring services, and financial products. These three lines of business are managed by the three participating institutions PSFU, UNCDF and UDBL respectively. Call for Proposals With this Call for Proposals, START is inviting proposals for commercially viable investment projects focused on agro-processing / value addition e.g. processing plants, storage facilities and any other agricultural value addition projects.

Priority will be given to projects that contribute to economic empowerment of women and youth as well as to projects that aim at reducing environmental risks and ecological scarcities.

Services offered by the START Facility to project developers

• Business Development Services

o Support in development of grant/ concessional loan applications, Legal support, Technical and management training.

• Project preparation and development services o Targeted technical project development and financing support to project developers (e.g. enhanced project documentation, due diligence and financial structuring).

 o Preparation of project investment documents in the format acceptable to commercial banks and investors.

o Provision of capital grants, credit enhancements/guarantees.

o Provision of business development services grants

• Financial services - link developers to financial institutions and investors o Preparation and issuance of term sheets & loan agreements.

o Issuance and administration of concessional loans. o Leveraging funds from other commercial and development finance institutions.

o Monitoring and management of concessional loan servicing and repayments.

Eligible geographical coverage of START

The geographic coverage for START is aligned with the geographic coverage of DINU and comprises 33 districts in Northern Uganda as indicated below. START will support development and financing of capital-intensive agricultural projects promoted by small and medium businesses that add value in storage and processing of agricultural produce. START will take into account the impact of the complementary activities for food production and commercial agriculture.