Peasants without financing

The winter wave has already left more than 10,000 peasants affected. In towns such as Nocaima, Nimaima and Villeta, the peasants have not been able to move from their villages due to landslides; their crops, their animals, their houses were destroyed by the violence of winter. However, the invoices for agricultural credits arrive without a hitch. The victims do not want refinancing of the debt, and it is logical that they do not want it. The interests are very high, it would be changing credits for even more expensive ones. They need more time for payments, which they will be able to make with the new harvest of their crops. This is one of the many problems with our agricultural credit system.

Agricultural loans in the country have been directed to large producers. For the year 2019 of the 19.2 billion pesos in agricultural loans, 70.7% went to large producers, 16.3% to medium-sized and only 13% to small ones. Since the creation in 1990 of the National Agricultural Credit System (Law 16/1990), credit has grown by an average of 6,357 operations per year. It would take 92 years to reach a million operations in credits from the 2.7 million farmers in the field. Today only 4% of small producers have credit coverage, according to the agricultural census (of course the census has flaws, but it is an indicator).

Finagro’s function of leveraging investment projects has also lost its purpose. For the year 2019, 55% of the resources went to credits related to working capital, 17% to normalization of the portfolio and only 28% to investments. Credit concentration is another barrier. 80% of the credits disbursed have been directed to 10 departments and 71% have resulted in large industries and hypermarkets (29% for medium and small producers).

Banco Agrario has placed close to a third of the total resources of microcredits in the country. However, the largest number of microcredits are delivered by private ones. Bancamia leads with 30.9% of total microcredits, Banco de la Mujer with 29.5%, Banco W with 16.1%, Banagrario only 9%. The last banks were born after 2008. On average, for the year 2019, Bancamía lent 2.6 million pesos per entrepreneur while Banagrario did it for 5 million.

I introduced a bill that would benefit small producers. The project establishes that 80% of the credits must go to the primary sector, and only 20% to the commercial and transformation sector. We created the categories of micro-producer, so that they have a percentage every year of effective credit.

The structuring of the credits must take into account the execution schedule of the productive projects and their cash flow projections. It is not acceptable that a small agricultural producer is required to have a grace year for an investment project that requires five years to bear fruit. We limit the costs and administrative expenses of intermediaries, so that the interest rates of the credits are lower. And we update the financing systems so that Fintech technology platforms and capital funds can lend to small and micro producers. We created a direct line of credit from Finagro for cooperatives and companies (which without making a profit place it at low cost) for the farmers.

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