May 22nd, 2025

I had the privilege of joining a panel at the FINAS 2025 Financing Agri-food Systems Sustainably Summit. I was invited to speak on funding resilient food systems from the perspective of financial health.

Our session followed two compelling keynotes. Nadine Gbossa, Director of Food Systems Coordination at IFAD, emphasised the power of data in decision-making, showcasing a new tool to track financial flows in African food systems. James Kashangaki then grounded us in the sobering reality of food systems embedded in fragile natural ecosystems – ecosystems now critically at risk.

My reflections on financial health speak directly to both themes: the power of data to illuminate what matters, and the urgent need to protect our shared natural resources -not just for food, but for the future of humanity.

Why financial health?

The concept of financial health emerged to answer a deeper question: Financial inclusion – for what? It shifts the focus from access to outcomes—measuring whether people are financially secure, resilient, and confident about their future.

Kenya has been a global pioneer in this space. Since 2016, the FinAccess survey has tracked financial health across three dimensions:

• The ability to meet daily needs
• The capacity to cope with shocks
• The means to invest in the future

I still remember the jolt of the 2019 FinAccess results: financial inclusion had risen, but financial health had declined significantly. That gap has persisted. More access hasn’t translated into better outcomes.

Financial health and food systems

Food systems are a cornerstone of both income and food security—especially for rural populations and micro and small enterprises (MSEs). In fact, the first indicator in our financial health index is whether a household has gone without food in the past year.

Income also matters. Our analysis shows that a 5% increase in income at the lower end of the spectrum boosts the likelihood of being financially healthy by 8%.

Yet, here’s the paradox: while farmers and food-related MSEs are more financially included than average, their financial health has declined more sharply – especially their ability to invest in future goals. This is deeply concerning, given their central role in our economy and food systems.

This paradox was at the heart of our FINAS 2025 discussion. As we mobilise more finance for agriculture, we must ask: Finance for what purpose? More isn’t necessarily better.

Financing resilient food systems

The FINAS 2025 summit—and frameworks like the Kampala Agreement and CAADP aim to build food systems that support jobs, equity, and sustainability. Financial health offers a powerful lens to rethink how finance can truly support these goals.

Two reflections stand out:

1. Women at the Centre

Women are the backbone of food systems – as farmers, traders, laborers, and caregivers. They share common goals: feeding families and building futures. Their networks and institutions, like chamas, are vibrant financial ecosystems.

Women’s ingenuity links production and trade, stretches budgets, and solves food system challenges daily. Finance must recognise, learn from, and strengthen these synergies to support women as curators of resilient food systems.

2. The Commons Matter

Farmers’ financial health depends not just on money, but on the health of shared resources: oil, water, climate, biodiversity. These commons are under threat. Farmers alone cannot protect them and often, economic pressures force them to degrade these very systems.

We need collective investment and regulation to sustain our natural capital. Farmers can be stewards of ecosystems, but only if we support them to do so.

Policy and finance: Four takeaways

1. Leverage social protection to stabilise food systems
Social protection can do more than alleviate poverty and reduce vulnerability to climate and other shocks. It can stabilise demand, reduce volatility, and give farmers and consumers the breathing room to make better long-term decisions. Integrated with agricultural investment, social protection can anchor resilient local economies (see also FSD Kenya 2023).

2. Redirect subsidies toward regenerative agriculture
Current subsidies often prioritise short-term productivity over long-term resilience. Instead of subsidising imported synthetic fertilisers, why can’t we redirect these subsidies to supporting regenerative practices – like composting, crop rotation, and agroforestry that enhance soil health, strengthen biodiversity and conserve water resources?
Reforming subsidy regimes to reward ecological stewardship and nutrition-sensitive farming could make a significant difference to resilience and long-term financial health. For these efforts to succeed, supporting systems and infrastructure need to be in place- including strong extension services.

3.Innovate finance for commons stewardship
Shared resources like soil, water, and forests are often invisible in financial planning. We need smarter instruments to incentivise their protection. Examples include

• • Performance-based funding for local authorities managing natural resources; alongside support in implementing regulation governing natural resources
  • Loans or insurance with incentives tied to sustainable practice.
  • Financiers also need to consider direct investment in natural capital to de-risk portfolios and enhance long-term value

4. Strengthen local financial ecosystems
Many smallholder farmers and MSEs – especially women- rely on community-based finance like SACCOs, chamas, and community banks. They also navigate complex supply chains using informal financial and social networks. These institutions often outperform formal alternatives in supporting long-term investment and liquidity needs.

Strengthening them through digitisation, shared services, and capacity building can amplify their impact and build stronger linkages with commercial finance. There is a caveat here: external interventions are not a panacea; they can sometimes do more harm than good. It is important therefore not to impose blueprint solutions on well-functioning local systems. Rather, we need to understand and engage with these systems to see when and how to enhance their value.

In conclusion, as we move forward, we must listen to those already solving the challenges at the heart of our food systems – especially women. And we must invest not just in individuals, but in the health of our shared resources.

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