Agriculture is a way of life and the engine of growth for most economies in developing countries. There are numerous growth potentials for farmer organization to increase productivity only when they are able to access finance. This has made access to finance not only a necessity but an urgent quest, a quest that will enable farmer organization increase yield and ensure food security.
In a report by Dalberg on “Catalyzing Smallholder Agricultural finance“, it is estimated that 450 $billion is needed for the 450 million smallholder farmers globally. This presents an unprecedented opportunity for financial institutions to open their doors to farmer organizations with credit worthy profiles. This notwithstanding high farm risks such as poor management, bad debts, low profitability, and low reserves are very critical elements that banks consider before they open their doors to farmer organizations. No farmer organization can be viable when these issues are not addressed and tackled, and this is only possible through profiling the performance of these farmer organizations and assessing their risks management. Doing this will help to identify and create creditworthy farmer organizations with low management risks.
