Risk Contingent Credit
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Risk-Contingent Credit (RCC): Assessing smallholders' agricultural credit needs and the feasibility of implementing RCC in Ethiopia
Author | : Timu, Anne G. |
Publisher | : Intl Food Policy Res Inst |
Total Pages | : 8 |
Release | : 2023-07-20 |
Genre | : Political Science |
ISBN | : |
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Agricultural credit is an important instrument for improving the welfare of farm households and their resilience to weather-related shocks. Farm households with access to credit can over come liquidity constraints and undertake investment in new production technologies such as improved seeds and machinery. This investment can boost farm production, food security, incomes, employment opportunities, and overall household welfare. However, in many low- and middle-income countries (LMICs), credit market imperfections pose a challenge to both the supply of agricultural credit and farmers’ use of credit (Marjit and Mishra 2020). Even when the credit infrastructure is relatively well-developed, smallholder farmers in LMICs remain largely underserved (Karlan and Morduch 2010; McIntosh et al. 2013).
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