History of ACGF

Over its decade and a half-long history, ACGF has proven itself as a reliable local and international partner promoting best pactice MSME lending.

Photographer: Antje Heyn

Less than 5% of Afghan SMEs are financed by a bank loan

Risky political and economic environment

Underfunded minority groups

Negligence on young entrepreneurs

Weak legal enforcement mechanisms

Hindered collateral collection

Consequently, prevention of job and income creation

In order to address issues such as weak economic growth, a high unemployment rate and very underfunded SME financing, the CGF-A, the predecessor of ACGF was founded by BMZ and USAID and implemented by DEG in 2004. Based on the successful run for a decade, BMZ and DEG decided to pursue an incorporation strategy in order to ensure its financial self-sustainability. This transform was supported by USAID, DAB, PFIs and the German government.

ACGF’s operations are in demand and highly scalable. This indicates ACGF’s potential for further intensification of its credit guarantee operations in Afghanistan for the benefit of the SME sector and the Afghan people.

In order to address concerns such as weak economic growth, a high unemployment rate and a severely underfunded MSME sector, CGF-A, the predecessor of ACGF, was founded by BMZ and USAID and implemented by DEG in 2004. Based on successful performance for a decade, BMZ and DEG decided to pursue an incorporation strategy to ensure the facility’s financial viability and thus ACGF took over CGF-A’s operations from DEG in 2015. 

ACGF’s operations are both in demand and highly scalable. This creates the potential for further intensification of ACGF’s credit guarantee operations in Afghanistan for the benefit of the MSME sector and the Afghan people.

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2004

Establishment
of CGF-A

CGF-A, the predecessor of ACGF, is founded through financing from BMZ and USAID.

2004
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2004 to Present

Supporting SME lending

ACGF establishes an SME unit to assist with upscaling from micro lending to include small and medium enterprises through 6  PFIs.

2004 to Present
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2013

USD 100m in loans guaranteed

2013
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2014

Establishment of ACGF

Based on the success of CGF-A, donors decide to pursue an incorporation strategy in order to promote the facility’s institutional sustainability with the supervision of DEG.

2014
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2015

Establishment of SCSA

SCSA, the Afghan-based subsidiary of ACGF, is founded as a financial consulting company working across all regions of Afghanistan.

2015
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2017

Funding under Access to Finance

ACGF receives funding of USD 9.1m from MoF based on funding from the World Bank to expand its credit guarantee activities and TA activities with its 5 PFIs. Since this time, 40 TA projects have been implemented and substantial growth of guarantee support has been achieved. 

2017
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2018

USD 200m in loans guaranteed

2018
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2020

COVID-19 Emergency Relief Guarantee Scheme for MSME in Afghanistan (CERG)

Based on strong support from BMZ/KfW, ACGF was able to rapidly initiate an effective COVID-19 response programme for Afghanistan. Under CERG, ACGF will be able to facilitate PFIs’ lending with COVID-19 responsive conditions of guarantees, crisis-response TA, initiation of matching grants and further measures. 

2020
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2020

Strengthening Afghanistan Financial Intermediation (SAFI)

An agreement on funding from the World Bank through MoF is being finalized for strengthening credit guarantee activities and bolstering technical assistance to PFIs. In addition, a new matching grants program will be established to support up to 1000 Afghan MSMEs over time with special emphasis on supporting women-owned enterprises and the agricultural sector.

2020
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2021

Establishment of Start-up Facility

Depending on the final decision from its German stakeholders, ACGF will be responsible for setting up a Start-up Facility in Afghanistan, providing comprehensive support to new entrepreneurs in Afghanistan with advice and facilitating opportunities for financing. 

2021
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Future

The future of ACGF

ACGF is strongly committed to the sustainable usage of funds committed by its donors to create a long-lasting impact. ACGF will continue supporting its PFIs so they can lend with confidence — promoting the growth of the MSME sector in Afghanistan.

Future
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