ACGF Business Model

ACGF combines the best of international best practice and local Afghan expertise. Through close cooperation between its diverse staff based in Germany and Afghan professionals from SCSA, ACGF provides tailored support to PFIs for the benefit of MSMEs in Afghanistan.

Photographer: Antje Heyn

Business Model of ACGF

ACGF is a charitable foundation that operates based on a secondary business model. ACGF uses credit guarantees as instruments for benefiting Afghan borrowers, the MSMEs, through intermediary vehicles, the PFIs, while ensuring the balance of interests among both parties. ACGF’s model guarantees:

Insurance to PFIs : The loan portfolios of the PFIs are covered.

Support to MSMEs: Easier access to finance for borrowers by incentivized PFIs.

International Security: ACGF’s financial viability is secured by its prominent international donors and by regulatory requirements under the laws of Germany, where the foundation is incoporated.

Local Security: All of the guarantee applications are checked against well-defined eligibility criteria developed in accordance with international best practices.

Reliability: ACGF is reliable partner to its PFIs for quick and uncomplicated payout mechanisms.

The structure of ACGF and its workflows are based on those of CGF-A, ACGF’s predecessor guarantee scheme. ACGF relies on its carefully selected PFIs and the efficient operations of the German ACGF office, in line with international best practices. 

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