Terms of Reference

SME Access to Finance

Financing Pathways Lead and Local Project Manager

Zambia National Advisory Board for Impact Investing (NABII) and the Bank of Zambia Credit Risk Guarantee Scheme (“CRGS”)

Performance Period: May 1-October 31,2023

Approximate Level of Effort (LOE): 45 days

Application submission deadline: April 15, 2023

Location: Zambia based

BACKGROUND, PROJEC FUNDERS AND KEY STAKEHOLDERS

The USAID Enterprise Development and Growth Enhanced (“EDGE”) Activity seeks to increase the profitability of agricultural small and medium enterprises (“SMEs”) by addressing their key constraints including limited business management skills, use of technology (including IT), access to local and regional markets, and affordable finance. EDGE targets SMEs that work in Central, Eastern, and Lusaka provinces in the following value chains: horticulture (to include annual fruits and vegetables), honey, poultry (to include layers, broilers and village chickens), aquaculture, groundnuts, animal feed (maize, soya beans, sunflower).

The Catalytic Capital Consortium (“C3”), of the MacArthur Foundation (“MacArthur”), aims to extend and deepen the reach of the impact investing field. The initiative is helping a select group of diverse funds address pressing challenges, while also building knowledge, awareness, and use of catalytic capital globally. To implement the C3 initiative, MacArthur selected a set of funds and organizations to receive impact investments totaling over $100 million. Collectively, this portfolio is intended to showcase powerful examples of catalytic capital across diverse sectors and geographies. It is designed to reduce risk, build track records, and increase the scale of promising fund managers.

The Zambia National Advisory Board for Impact Investment (“NABII”) is a non-profit organization created to accelerate the growth and effectiveness of the impact investment ecosystem in Zambia. NABII provides an all-inclusive platform to facilitate the mobilization of stakeholders and resources to support the creation of a private sector driven impact economy. The aim of the scheme is to accelerate access to appropriate capital for SMEs in specific sectors (e.g., green energy, food and agriculture, health and education).

The Global Steering Group for Impact Investment (“GSG”) is an independent organization with experience leading collaborative partnerships encouraging investment readiness, and catalyzing new investment instruments (e.g., impact wholesalers, outcomes funds, impact funds of funds, etc.) in partnership with international organizations as well as local government and regulatory entities.

OBJECTIVE

EDGE, along with funding partner C3, seeks support in providing project management leadership and technical expertise to its partner, NABII. NABII has recently signed an MOU with the Bank of Zambia (“BoZ”) regarding the establishment of a Credit Risk Guarantee Scheme (“CRGS”). The project has been designed, approved, and funded by the core stakeholders and is now ready for implementation in accordance with the approved workplan and budget.

This consultant(s) will serve as a SME Access to Finance technical and overall project lead, contributing to each of the planned workflows A, B, and C — as outlined in the Annex, while also integrating the findings from these workflows into a deliverable consisting of a guidance note designed to inform the CRGS Technical Financing Pathways Guidance Note.

DELIVERABLES

The consultant will oversee submission of the following deliverables, with payment contingent on EDGE’s acceptance:

No.

Description

Period

1 Participating in structuring SME/FI/NBFI Interviews and contribution of FI/NBFI guidance to the MSME Mapping and FI/NBFI Assessment Report-20 days

2 Participation in Workshop and Roundtables (~ 3-4) and Extraction of Relevant FI/NBFI Findings from Workshop- 7.5 days

3 Synthesis of Findings and Drafting of the CRGS Technical Financing Pathways Guidance Note- 7.5 days

4 Project Management, Administration, Logistics and Technical Coordination with a focus on coordination of and extraction of findings from workflows A and B that drive the (i) CRGS Understanding of SME access to finance needs and opportunities and (ii) Technical Financing Pathways Guidance Note- 10 days

QUALIFICATIONS

• Locally based, highly inclusive team representation
• Degree(s) in finance, economics and/or business studies. Data analytics would be beneficial.
• Demonstrated relevant experience in transversal project management
• Experience in and/or assessing access to finance considerations for Sub-Saharan African SMEs
• Experience in assessing capacity of local FIs/NBFIs to extend SME finance
• Familiarity with innovative and transitional capital mechanisms
• Experience with local capital markets, financial structuring, and financial institutions
• Excellent research, writing, synthesis, and presentation skills, including workshop moderation, and the use of document publication (e.g., Word), presentation (e.g., PowerPoint) and worksheet (e.g., Excel) tools
• Experience in applying rigorous data gathering and analytical processes.
• Ability to integrate horizontally generated findings from concurrent mapping, workshop and roundtables and digital solutions findings into a series of presentations guiding the development of the CRGS.

REPORTING

The consultant will report to NABII, the Bank of Zambia, and USAID EDGE.

APPLICATION

The interested consultant should submit the following by April 15, 2023

1. CV specifically responding to required qualifications:

PROJECT DETAILS

The project consists of multiple overlapping and tightly integrated workflows, with deliverables across at least four ToRs and culminating in a CRGS Technical Financing Pathways Guidance Note.

A. SME Mapping and Financial Assessment (Primary Owners are MSME Mapping, and FI/NBFI Technical Pathways Leads respectively) – Enterprise level knowledge gathering, mapping and segmentation – to involve developing a methodology for knowledge development for assessing MSME financing and capital needs; segmentation of MSMEs by key factors such as stage of enterprise, industry segment, and financing needs; assessing local FI/NBFIs capacity to meet these needs; and mapping services from local and international experts on enterprise development and MSME finance to lead this market assessment.

B. Workshop and Roundtable Production (Primary Owner is Anchor Project Lead) – organization (~ 3-4 minimum), preparation of pre-reads and gathering and reporting on findings as to SME needs and financial sector capacities and challenges. Workshops are planned as follows:

• Convene local MSMEs to confirm market data.
• Convene FI/NBFIs to confirm and review market data.
• Convene local and international stakeholders to review experiences and approaches to accelerate and scale SGB access to finance.
• Engage local and international experts with expertise in MSME finance and financial “engineering” to support the assessment and development of specific technical issues related to (i) capacity and approach of FIs/NBFIs to provide MSME finance, and (ii) the CRGS design.

C. Financing Pathways Mapping (Primary Owner is FI/NBFI Technical Pathways Lead) – Development of alternative approaches and pathways for the credit guarantee scheme program design, incorporating outreach and findings from A and B above (CRGS Technical Financing Pathways Guidance Note). This phase of the work will result in:

• Preliminary Design of Pathways for a CRGS
• Lead technical design of the CRGS
• Engage with NABII and stakeholders to identify key success factors for the CRGS and how those can be included in the design
• Liaise with all the key stakeholders as necessary to ensure CRGS is appropriately placed within market (financial institutions, central bank, BDS providers, etc.)
• Create an implementation schedule for a CRGS
• Upon approval of the technical design, develop a detailed roadmap for implementation for the CRGS including approximate timeline
• Identify necessary manpower/womanpower necessary for implementation
• Identify any other costs related to establishing the CRGS

D. Digital Innovation and Value Chain Finance Assessment (Primary Owner is Digital Innovations and Value Chain Lead) – Assess extent to which technology and value-chain finance can address supply-side risks in the CRGS design in order to facilitate impact at scale in line with macroeconomic objectives set out in the 8th National Development Plan.