The project cluster evaluation on rural finance in East and Southern Africa (ESA) covers three projects: the Programme for Rural Outreach of Financial Innovations and Technologies in Kenya; the Rural Finance Expansion Programme in Zambia; and the Rural Financial Intermediation Programme II in Ethiopia.

All three projects aimed to reduce poverty rates among smallholder farmers and improve food security and nutrition of rural households by increasing the provision of financial services, although with different strategies.

All projects were effective in reaching their targets and increased the number of rural households reached by financial services. However, this impact could not be clearly quantified as the ultimate beneficiaries could not be clearly tracked. The projects introduced innovative approaches, such as credit-guaranteed schemes; these made efficient use of project funds, but were challenging to implement. The differences in the level of IFAD supervision across the three projects affected their implementation, which demonstrates the importance of close follow-up by the Fund.

The evaluation’s recommendations for the future include requiring and providing guidance to project management units on setting mutually clear expectations of the implementation, targeting and reporting requirements, as well as providing greater technical guidance on targeting strategies aimed at addressing the needs of disadvantaged groups, such as youth.