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Applications are invited for:
Title: Call for Concept Note Applications - Feed the Future Nigeria Rural Resilience Activity Innovation Fund
Locations: Adamawa, Borno, Gombe & Yobe
Background
The Rural Resilience Activity (RRA) is a Feed the Future initiative funded by the United States Agency for International Development (USAID). Mercy Corps is the prime implementer and is in partnership with Save the Children International (SCI) and International Fertilizer Development Center (IFDC). The goal of the Rural Resilience Activity is to ‘facilitate and protect economic recovery and growth in vulnerable, conflict-affected areas and sustainably move people out of chronic vulnerability and poverty via expanded opportunities’. This goal will be achieved through the following four major components:
- Provide up-to-date evidence for the selection of market systems, livelihoods, and employment opportunities that contribute to inclusive and resilient growth and improved nutrition.
- Stimulate market systems growth and diverse economic opportunities (Pull activities).
- Build capacity to take advantage of market systems opportunities (Push activities).
- Sequencing, layering, integrating (SLI), and collaborative learning to improve activity effectiveness, sustainability, and scale
The Rural Resilience Activity will be implemented using a resilience, market systems development, conflict and nutrition-sensitive approach, to stimulate sustainable, systemic change at scale and bring long-term improvements to conflict-affected households, businesses, and institutions. This will involve multiple partnerships with the private sector and government actors. The Rural Resilience Activity places a deliberate priority on targeting women and youth. The activity targets sectors/value chains including but not limited to: maize, cowpea, groundnuts, rice, sheep and goats, agricultural inputs, financial services and other urban/peri urban labor-intensive job creating sectors specifically targeting women and youth.
Funding Opportunity
- Rural Resilience Activity is pleased to invite Nigeria-registered social enterprises, for-profit businesses, Community-based Organizations (CBOs), Business Membership Organizations (BMOs) and non-profit organizations to submit an application for an award. This solicitation and other related documents can be found on the funding page of Mercy Corps website.
- The award will be directly managed by the Rural Resilience Activity with USAID support. The intention of this solicitation is to identify for-profit, private sector partnerships and enter into a business metric-based milestone agreement that includes interventions that fit the evaluation criteria set forth in Section 9 below. The number of partnerships available will be determined based on interest, funding available, and quality of proposals. The proposed projects are anticipated to begin in September 2020 and end on or before August 31, 2022.
- Subject to the availability of funds, Rural Resilience Activity plans to issue multiple awards under this call. The total value of each award from the Rural Resilience Activity for this solicitation is estimated to range from US$10,000 - US$500,000 with 10 to 20 partnerships anticipated. Proposals must make business sense for the partner and must clearly demonstrate a significant impact for smallholder farmers and MSMEs.
- As the amount of an award is subject to negotiation, a negotiated award amount may or may not fall within this range. Furthermore, the Rural Resilience Activity is not obligated to issue awards/an award up to the amount of funds available. Grantees must cover a minimum of 1:1 cost share/leverage ratio (with higher leverage ratios preferred) as further outlined below.
- Application reviews will take place in August 2020. All applicants will be notified of application status at this time. Note that immediate negotiations and site visits will occur with successful applicants sometime between August and September 2020. Site visits and other engagements requiring physical interactions will take into consideration relevant COVID-19 guidelines from the Federal and targeted State Governments in Nigeria. Please make sure the proposed project manager and a decision maker will be available at that time. The negotiations and site visit are required steps in the award process for selected applications.
- Partnership agreements will be negotiated with selected applicants based on the criteria described below. If the proposed activities require financial investment, applicants will also be expected to provide co-investment (in-cash or in-kind) to support their proposed activities. Concept Notes must be submitted in accordance with the format described below and received no later than July 17, 2020.
- All questions regarding the solicitation will be answered in writing. Questions can be submitted through July 17, 2020 at 17:00 to: nig-innovation-fund@mercycorps.org
Objective of the Call for Applications
- Nigeria’s North East region is particularly vulnerable to economic decline as a result of COVID-19 due to its highly informal food systems that rely on micro and small enterprises. Steepest increases in poverty over the short-term are expected in urban areas where restrictions are more stringent. Pre-existing crises (conflict, displacement) are compounding the effects of COVID-19 restrictions.
- Restrictions on business operations and trade have significant negative impacts on people’s ability to work across formal and informal sectors. This has compromised livelihoods, increased the costs of food and basic services, disrupted logistics, operations within agrifood supply chains and consumer markets. North East Nigeria’s dependence on seasonal agriculture may have variable impacts with upcoming lean seasons and concerns about last mile market access to inputs, information, extension and advisory services, and markets to agricultural products.
- Livestock markets in some locations are witnessing drops in both supply and demand and are accompanied by concerns about access to vet. drugs and income losses. Smallholder farmers and MSMEs experience low access to credit, while cash in, cash out (CICO) agents are struggling with liquidity.
- The Rural Resilience Activity’s Innovation Fund is designed to catalyze new investments in viable economic opportunities (market systems, livelihoods, agribusiness, and employment), stimulate market development and thus reduce the economic, social, and environmental drivers of conflict. The fund will rapidly identify and support Nigerian firms at a national level and their local and regional business partners. It will target businesses and institutions working in labor-intensive and women-dominated agricultural and non-agricultural sectors and who have been disproportionately impacted by the conflict and other shocks and stresses.
- The Rural Resilience Activity will rapidly review and disburse direct grants averaging between $10,000 and $500,000 focused on ensuring market-driven mechanisms that will help businesses, institutions and smallholder farming households to cope, mitigate, adapt and sustain wellbeing outcomes in the face of shocks and stresses such as the COVID-19 pandemic, conflicts, adverse weather effects and other disruptions to agrifood and non-ag. supply chains.
- Activities of smaller or larger amounts may be considered should the proposed activity meet the objectives of the Call for Applications (CFA). The Rural Resilience Activity will co-create inclusive growth solutions with awardees and structure grants requiring co-investment by companies, but with company contributions timed later in the grant period, and as markets and trade start to recover, thus ensuring companies maintain liquidity during and post COVID-19. Where appropriate and to enhance collaborative learning as well as sequencing, layering and integration, awardees are expected to coordinate with other USAID Feed the Future-funded Activities in North East Nigeria.
- The Rural Resilience Activity’s Innovation Fund invites applications from social enterprises, for-profit organizations, private sector companies, CBOs, BMOs, and non-profit organizations that meet the definition of 2 CFR 200.70 and which are registered in Nigeria. Foreign Organizations (referred to as non-U.S. NGOs) which can be either nonprofit or for-profit organizations that meet the definition in 2 CFR 200.47 can apply as part of a consortium.
However, the lead applicant must be legally registered in Nigeria. Applicants should propose activities that incorporate and ultimately benefit smallholder farmers and MSMEs in at least one of the following intervention areas:
- Increase access to agricultural inputs, specifically post-harvest storage solutions
- Improved technologies including time-saving, productivity enhancing agricultural technologies and digital technologies such as fintec, precision farming, etc.
- Increased access to financing for large firms, smallholder farmers and MSMEs.
- Better agricultural and business management practices resulting in improved competitiveness, productivity, income, gross margin and yields for smallholder farmers and MSMEs.
- Expansion of market access for smallholder farmer commodities through improved services by offtakers, processors, and other institutional markets resulting in premium and high-value prices for smallholder farmers and MSMEs.
- Diversification of products and or marketing channels enabling increased access to information, advisory and extension services at the last mile, ultimately helping smallholder farmers and MSMEs to be more resilient to climate (e.g. droughts, heavy rains etc.), health (e.g. COVID-19, etc.) and other shocks and stresses
- Creation of new private sector, rural and urban employment and entrepreneurship opportunities.
Applicants must target activities in one or more of the following geographic areas and/or value chains. Note that applicants can propose working outside of the Local Government Areas below provided that potential program participants (beneficiaries) are in at least one of the targeted States. Activities conducted by applicants outside these States or which do not directly benefit smallholder farmers and MSMEs resident in the States indicated below would not be funded under the Rural Resilience Activity’s Innovation Fund and will not count towards cost share or leverage. Rural Resilience Activity recommends that applicants should target their activities within the suggested Local Government Areas, as these are areas with comparative advantages vis-à-vis value chains, safety and other enabling factors.
States: Local Government Areas:
- Borno: Biu, Hawul, Kwaya Kusar
- Adamawa: Hong, Song, Gombi, Mubi, Yola
- Yobe: Jakusko, Nanjere, Potiskum, Damaturu, Nguru
- Gombe: Kwami, Akko, Dukku, Billiri, Gombe, Bajoga
Sub-sectors and value chains:
- Rice
- Maize
- Cowpea
- Sheep and Goats
- Agricultural inputs (post-harvest solutions)
- Financial services
Examples of activities that could be supported:
Proposed activities should be based on a sustainable business model. The applicant is responsible for organizing and managing activities with technical and/or financial support from the Rural Resilience Activity. Examples of activities that could be supported include, but are not limited to, the following:
- Develop a network of mobile agents, agro-dealers and other input providers to increase uptake or strengthen use of an existing or new digital agricultural finance/trade platform
- Develop or increase access to an improved range of appropriate financial products and services or develop stronger linkages with new and existing suppliers of inputs to increase quality, variety, and reliability of products (for example sharia-compliant loan products or digital savings and credit products for smallholder farmers, producer organizations, etc)
- Improved promotion and delivery of products and services (for example last mile mobile agents leveraging digital technologies to deliver loans, inputs, extension and advisory services, or business, financial literacy, soft skills, and agricultural training to remote rural areas)
- Strengthen the capacity of branch staff and other last mile agents to effectively and responsibly deliver new and existing services e.g. agricultural advice to customers
- Introduce a new business model for providing end-to-end digital agriculture services including a bouquet that enables smallholder farmers and SMEs access quality inputs, information and advisory/agricultural extension, higher value output markets and financial services.
- Support aggregators, retailers and other VC facilitators to make food items available in urban markets (distribution and marketing roles) through processors with existing out grower schemes and trusted network of establish aggregators
- Finance for maize/rice mills & related products to increase production, to hire more labor, buy necessary bagging equipment and increase storage
- Reduce postharvest losses and reduce aflatoxin levels in maize via targeted smallholder farmer training in maize growing areas (pre-harvest, maize dryers, power threshing, improved storage through hermetic and other storage solutions, etc).
- Support to rice producers for pre-harvest, finance transport to mills, power threshing, improved storage, drying and milling
- Support to other types of value addition processes that aim to create alternative markets and better income to smallholder farmers
- Improved digital literacy for women to foster women economic empowerment
This list is non-exhaustive. It is simply to provide examples of company initiatives that could be supported by the Rural Resilience Activity. Any additional ideas or a combination of these activities is encouraged, and all ideas will be considered for Rural Resilience Activity support.
Eligibility and Evaluation Criteria
- All applicant businesses must be legally recognized entities in Nigeria and able to provide documented proof of legal status. Applicant businesses should have been in operation for more than one year with demonstrated potential for commercial viability and relevant experience in the technical areas proposed in the application. Prior to award, Rural Resilience Activity will conduct due diligence on selected applicants. The due diligence process includes reference checks; a pre-award survey to ensure successful applicants have the organizational, managerial, and financial systems and controls in place to manage a performance-based milestone agreement; and a site visit to evaluate the proposed strategy, meet with local stakeholders, and verify the potential impact proposed.
- Prior experience with USAID or other US government entities is not required. However, if the applicant has received US government or other donor funding in the past or has a proposal pending, details and purpose of such funding should be noted in the application. For applicants who have received donor funding in the past, details of fund use should be included and any other reference information. Failure to disclose this information will result in disqualification.
- Applicants are required to propose leverage/cost share in their cost proposals. Rural Resilience Activity reserves the right to negotiate the final proportion with successful applicants during negotiations. Funds from United States government-supported programs cannot count towards leverage/cost share. For private sector businesses, it is expected that proposed leverage/cost share contributions must come from the enterprise’s personal funds and assets and not from United-States government or other donor supported-funds. Proposed contributions must be appropriate, relevant to the proposed activity, and will be carefully considered during the evaluation of applications
The following activities are not eligible for funding:
- Pure academic research.
- Technologies that have not been market tested and require further research and development.
- Agricultural commodity procurement.
- Restricted commodities and services from ineligible suppliers in accordance with 22CFR228.123.
- Eligible applicants for this opportunity must:
- Be registered as a legal entity with the Government of Nigeria; implementing partners and other organizations may be included in a consortium such as other commercial businesses, farmer cooperatives, consulting firms, and/or business/member associations
- Provide an investment in the proposed initiative of at least a one-to-one match between Rural Resilience Activity funds and private sector funds. Preference will be given to proposed partnerships with higher leverage. See Section 10 for further explanation of leverage requirements.
- Propose partnership of up to 24 months in duration with an end date on or before August 31, 2022.
- Upon submission, the RRA Team will evaluate all Concept Note applications using the following criteria:
- Eligibility of the applicants per the above criteria, including completeness of the application, attaching all required additional forms and proposing cost-share/leverage ratio
- Alignment with Rural Resilience Activity (RRA) Objectives
- Viability and sustainability of the concept/business model and impact on activity’s target groups
- Expected scale of positive impact of the proposed activities
- Track record and experience of applicant
- Value of impact compared to the cost of the activities
Furthermore, proposed activities will be evaluated on other factors with the most important being their ability to achieve significant commercial-scale results through market-based approaches that include co-investment from private funding sources to advance the project. Another general eligibility requirement is that the proposed projects and activities must be funded through private financing, which can include equity capital (internal or external), and/or debt capital from banking and other financial institutions. For Universities, CBOs or other NGOs, private financing could include but not be limited to man-hours of staff and volunteers, etc. Further, the Rural Resilience Activity will prioritize the projects and activities that exceed the one-to-one matching fund requirement governing the grant partnership. Activities with a potential to engage women and youth are also priorities.
Method of Application
Interested and qualified companies should send an email to: nig-innovation-fund@mercycorps.org
