Call for Proposal: Consortium of an INGO and a local NGO/CSO to provide services for the management and implementation of the Matching Grants Facility

Link to Atlas Project

00095145 – Livelihoods and Entrepreneurship Development Programme

Documents

Matching grants budget template
Call for proposal template
Terms of Reference Matching Grants Facility

Overview

Background and context

1.1 Political and economic context

South Sudan’s rural economy remains constrained by low agricultural productivity, weak infrastructure, and fragile financial systems. Yet agriculture continues to employ most of the population and holds significant potential to improve food security, resilience, and inclusive economic growth. The limited penetration of formal financial services has left many RPOs, cooperatives, and MSMEs dependent on informal mechanisms, restricting their ability to invest and expand.

1.2 READ project context

The Rural Enterprises for Agricultural Development (READ) project, co-financed by IFAD and GAFSP and implemented by MAFS with UNDP support, is a seven-year initiative designed to:

• Improve food security, nutrition, and incomes of targeted households.
• Strengthen RPOs and cooperatives as viable, inclusive enterprises.
• Expand access to rural financial services, especially through the Cooperative Bank of South Sudan (CBSS).
• Enhance the enabling policy environment for cooperative and enterprise development.

1.3 Project Goal and Objective

The overall goal of the READ project is to ‘improve food security and nutrition, income and resilience among the targeted rural households.’ The Project Development Objective is to ‘empower Rural Producers’ Organizations (RPOs) as sustainable and resilient food value chain players.’

1.4 Geographic coverage and target locations

READ operates in four states and six counties: Eastern Equatoria (Magwi), Western Equatoria (Yambio, Nzara, Maridi), Northern Bahr el Ghazal (Aweil centre), and Upper Nile State (Renk)

1.5 Matching Grants Facility

A central component of READ (1.3) is the Matching Grants Facility, structured into three funding windows:

• Window 1 – Asset transfers to Agricultural Producer Groups (APGs): This provides productive assets to Tier 1 groups, coupled with support to build their organizational management and accountability systems. This ensures assets are used transparently, strengthens group cohesion, and prepares them to transition into cooperatives that can access finance in later windows including implementation of strategies that prevent them from sliding back.
• Window 2 – Matching Grants for cooperatives: This provides grants for emerging and mid-tier cooperatives (at an approximately 80:20 grant-to-co-financing ratio). These cooperatives are not yet ready to receive credit but are able to mobilize limited contributions in cash or kind. The support will help them invest in storage, aggregation, or processing equipment, while strengthening financial discipline and market engagement. Implementation of strategies to prevent them from sliding back shall continue to be provided to these groups
• Window 3 – Matching Grants for Tier 3 Cooperatives/MSMEs: This provides blended financing support combining CBSS loans with performance-based grants. The precise structure of the blended model, including the loan-to-grant ratios and repayment modalities, will be finalized jointly with CBSS. The aim is to incentivize strong repayment performance, reduce financial risk for borrowers, and enable enterprises to expand climate-smart and nutrition-sensitive investments.

The financing approach will evolve across the three windows: from full grants for the weaker groups to blended finance for more mature cooperatives and MSMEs. The specific design of the blended finance modality, including the loan-grant ratios, repayment conditions, and risk-sharing mechanisms, will be developed in close partnership with CBSS. The overall objective is to promote responsible borrowing, reward good repayment performance, and gradually transition capable enterprises toward commercial finance borrowing while ensuring financial sustainability for both beneficiaries and the bank.