Landmark Investment in Kaebauk Investimentu No Finansas (KIF), Marking AgriFI First Pacific Transaction under ACP Mandate 

Dili, Timor-Leste / Brussels, Belgium – 16 June 2025 – EDFI Management Company (EDFI MC) announced today an investment in Kaebauk Investimentu No Finansas (KIF), Timor-Leste’s leading microfinance institution, through its EU funded Agriculture Financing Initiative – AgriFI. This transaction, executed through the AgriFI ACP Regional Window, marks AgriFI’s inaugural investment in the Pacific region and underscores its commitment to unlocking sustainable agricultural finance in fragile and underserved markets.

“Supporting initiatives like KIF through AgriFI reflects our strong commitment to inclusive growth and sustainable agriculture in the Pacific region. By unlocking private sector investment in fragile markets, we are enabling local institutions to drive lasting change, empower rural communities, and build resilient economies,” said Yvonne Chileshe, Office in Charge, Policies and Programmes at the Secretariat of the Organisation of African, Caribbean and Pacific States (OACPS).

In spite of notable improvements, Timor-Leste, classified in 2025 by the OECD as a fragile country, remains one of the world’s least developed and most challenging environments for investment, with limited industry, high unemployment, and widespread rural poverty. Despite these challenges, KIF has emerged as a vital financial lifeline, operating since 2001 and now serving over 15,000 clients—more than 70% of whom reside in rural areas—across all 13 districts via 22 branches. KIF’s focus on microcredit and SME finance, particularly in agriculture, directly addresses the needs of smallholder farmers and entrepreneurs who are otherwise excluded from the formal financial system.

“Our investment in KIF reflects our commitment to catalysing inclusive agricultural development in some of the world’s most fragile markets. By providing subordinated debt, we are reinforcing KIF’s catalytic power and enabling it to deepen its outreach to smallholder farmers and rural entrepreneurs who are critical to sustainable economic growth,” said Rodrigo Madrazo, CEO of EDFI Management Company. “These junior financial instruments are particularly catalytic in fragile markets, as they absorb higher risk and enable financial institutions to expand lending, especially to underserved segments such as rural and agricultural borrowers.”

Mr. Angelo B. C. Soares CEO of KIF added: “This partnership with EDFI MC is a significant milestone for KIF and for Timor-Leste’s rural communities. Strengthening our capital base with long-term, flexible financing empowers us to expand our services to smallholder farmers and rural entrepreneurs, who are at the heart of our country’s sustainable development. Together, we are building resilience, fostering economic opportunity, and contributing to a more inclusive future for Timor-Leste.”

This investment is the first by AgriFI in the Pacific under its mandate for African, Caribbean, and Pacific (ACP) countries, reflecting the EU’s commitment to fostering sustainable private sector development in regions that are often overlooked by mainstream investors. The AgriFI ACP Regional Window, with a budget of €50 million, is dedicated to supporting smallholder farmers and agri-SMEs through long-term, flexible financing solutions.

KIF is majority-owned by local NGO Tubai Rai Metin, with additional backing from the International Finance Corporation (IFC) and microfinance network BOPA, ensuring strong governance and alignment with development objectives. The institution is recognized as the largest private employer in Timor-Leste, with over 300 staff, and has a proven track record of empowering women and rural entrepreneurs—over 70% of its clients are women, and agriculture accounts for more than 13% of its lending activities.

About Kaebauk Investimentu No Finansas (KIF)

Founded in 2001, KIF is Timor-Leste’s largest microfinance institution, licensed as an Other Deposit Taking Institution (ODTI). With a mission to improve quality of life and empower women, KIF provides microcredit, SME finance, and a range of financial services to underserved communities nationwide.

About EDFI Management Company 

EDFI Management Company (EDFI MC) is a multilaterally owned impact asset manager which delivers innovative development finance solutions that enable European DFIs, development banks and private sector investors to increase the scale and impact of their work. The company focuses on business models, technologies and geographies where other investors have not been able to operate at the desired scale given their resources and investment criteria.  

AgriFI, the EU Agriculture Financing Initiative, is an impact investment facility funded by the European Union, managed by EDFI Management Company, with a mandate to unlock, accelerate and leverage sustainable investments in medium, small and micro agri-enterprises (MSME) that operate in developing countries, with a specific focus on smallholder’s inclusiveness. For more information, visit www.agrifi.eu and www.edfimc.eu. 

About EDFI AgriFI – ACP Regional Window

EDFI AgriFI – ACP Regional Window, is a dedicated pocket of capital within EDFI-AgriFI allocated to entities operating in Members of the OACPS. Funded by the European Union in the framework of the 11th EDF Intra – ACP Private Sector Development Programmes, the regional window will provide medium to long-term financing to private sector enterprises and institutions active in the agri-food value chain and benefitting smallholder farmers. For more information, visit https://www.oacps.org/.

For more information, please contact:

Natasa Lakovic

Senior Communication Specialist

EDFI Management Company

Email: n.lakovic@edfimc.eu