Mitigating the Risk of Lending to Agricultural Producers through Adaptive Loan Methodologies
Small-scale agricultural producers are often excluded from formal financial systems because they are considered “too risky” to financial institutions. In this session, the World Council of Credit Unions (WOCCU), will discuss the development of an innovative lending toolkit implemented with its partner national credit union associations in Guatemala and Kenya that reduces the risk of lending to smallholder producers. The lending toolkit is designed to minimize systemic risks by attracting new customers and providing alternative credit evaluation based on cash flow, specialized disbursement and repayment according to production cycles, value chain integration through market contracts, and loans bundled with technical assistance and insurance. WOCCU will discuss the different elements of the toolkit and demonstrate the mobile application. Participants will also have the chance to role-play as different members of the value chain and use the toolkit to help them access new loan products.
World Council of Credit Unions (WOCCU)