Enhancing Direct Access to GCF Funding for Equity Group to Scale MSMEs Adoption of Climate Technologies in East Africa

Adaptation Need

MSMEs across East Africa are disproportionately vulnerable to the worsening impacts of climate change. These businesses – especially in agriculture, water, fisheries, and energy sectors – face heightened exposure to droughts, floods, erratic rainfall, and rising temperatures. Climate models project increased frequency and intensity of such events, threatening productivity and income stability for millions. For example, in Kenya alone, up to 98% of agriculture is rainfed, making it acutely sensitive to climate variability. In Rwanda, water scarcity is projected to worsen, directly affecting hydropower-dependent SMEs and rural food systems. Despite their crucial role in local economies, MSMEs encounter significant barriers in adopting climate-resilient technologies. These include lack of affordable financing, limited access to technical information, weak market linkages, and inadequate institutional support. Women-led businesses—often in informal sectors—are particularly disadvantaged, facing greater barriers in accessing credit and climate-smart tools.  

GCA’s Added Value

The GCA–EGH partnership plays a pioneering role in advancing private sector engagement in adaptation finance in Sub-Saharan Africa, where regionally accredited private-sector DAEs remain virtually absent. Their collaboration led to the Scaling-up MSMEs Adoption of Climate Technologies in East Africa (SMACT) Concept Note, a project targeting 1.42 million direct beneficiaries (30% women) and supporting 140,000 MSMEs through concessional financing, LFI strengthening, and access to climate technologies and capacity-building for improved resilience and adaptive decision-making.