Development Financing for Agro-industrialisation
This article discusses the trends in advances to the agriculture sector by regulated financial institutions (RFIs) for the period 2015 to 2017.2 Similar information on the trends in advances to the sector by RFIs was compiled and presented in the previous Agricultural Finance Yearbooks.3 The 2015-2017 trends presented in this 9th edition of the Yearbook, are compared with the trends in the 8th edition, which was published in 2015.
This article examines trends in the; volume, level of participation of RFIs; and deepening of agricultural lending as reflected by the numbers of participating RFIs and the disbursements made. The article also analyses the cost of credit (interest rates) to agricultural value-chain actors.
As in previous Agricultural Finance Yearbooks (AFYBs), the analysis tracks new advances to the agricultural sector rather than the outstanding portfolio. This approach provides a more dynamic view of the developments in lending to the sector. However, unlike the previous four editions, trends in leases to the agricultural sector are not discussed due to the lack of data. Instead, an analysis of lending rates is done.
In Section 2, the article focuses on; trends in total agricultural lending and RFI participation. Discussions of the share of RFI lending to total agricultural lending; and lending by activity are presented in Section 3 and 4 respectively. The article ends with Section 5 where there is an analysis of agricultural lending rates, and a presentation of conclusions and policy options.