Financial inclusion for agricultural growth: An alternative approach
08 Dec 2014
Traditional, group-based microcredit has had limited success at enabling farmers to expand the cultivation of risky but profitable cash crops. Evidence suggests that this is mainly because of its mechanisms for borrower selection and enforcement of repayment. This column proposes a new approach that leverages local intermediaries and aligns their incentives with farmer profits, to generate better outcomes for agricultural production and incomes.
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