Difference between revisions of "SPIS Invest"
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=== '''<span style="color:#879637;">Supplementary Tools</span>'''=== | === '''<span style="color:#879637;">Supplementary Tools</span>'''=== | ||
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=== '''<span style="color:#879637">Further Readings </span>'''<br/> === | === '''<span style="color:#879637">Further Readings </span>'''<br/> === | ||
Revision as of 08:40, 27 November 2017
Module Aim and Orientation
Financing solar-powered irrigation can be an opportunity for financing institutions seeking to diversify their loan portfolio and expand their range of financial products. The FINANCE module focuses on product features for SPIS loans, considering direct financing by financial institution to a small and medium-scale agricultural end borrower. read more
The module also points out how it is different from financing conventional irrigation systems. It provides guidance to financial service providers already financing or planning to finance SPIS. It thus addresses two groups:
- stakeholders at management level who decide upon credit policies of a financial service provider.
- loan officers who assess single loan applications for financing SPIS.
The FINANCE module, being part of a comprehensive toolbox, relates to the other modules in several ways. GET INFORMED, the first module of the manual gives basic information on SPIS and its components. Methods for its promotion are described in the PROMOTE & INITIATE module, including one process step on access to finance as an important precondition for promoting SPIS in a particular region. Natural limitations of the environment and a sustainable use of water and other resources are crucial when considering risks. These factors are described in the SAFEGUARD WATER module. The DESIGN module provides information, tools and examples on how to estimate the dimensions of a SPIS for a specific farming situation. It also includes guidance on the calculation of the financial viability of SPIS which is critical to assess the loan (financing volume and profitability). The DESIGN module aims at establishing the financial viability of a particular design, whereas the module FINANCE focuses on HOW to finance the respective SPIS design. The modules SET UP and MAINTAIN describe aspects to be considered when installing and maintaining SPIS. Checklists and other tools in these two chapters are of specific value to banks when paying visits to clients with a running SPIS.
Process Steps
Three steps are elaborated in the FINANCE module to support the process of defining the financial service provider’s credit policy on management level: First the analysis of the potential of the SPIS market segment; secondly the determination of general credit risks involved; and thirdly, the design and test of suitable financial instruments. read more
For the specific individual loan assessment process on loan operations level, three main steps are elaborated: First, the determination of the financing volume and calculation of the profitability of the investment; secondly, the assessment of credit risk and collateral of the potential borrower; and finally, the determination of the cash flow and the repayment plan for the single potential client, along with loan conditions.
Chapters
1. Credit policy: analyze potential
2. Credit policy: risk analysis
3. Credit policy: select/develop Suitable Financial Instruments
4. Loan assessment: determine financing volume and profitability
5. Loan assessment: assess credit risk and collateral
6. Loan assessment: adjust repayment plan to cash flow
Supplementary Tools
Further Readings
- Agriculture Finance Support Facility (AGRIFIN). Retrieved from https://www.agrifinfacility.org/
read more
- Making Finance works for Africa (2017): Agricultural & Rural Finance. Retrieved from http://www.mfw4a.org/agricultural-rural-finance/agricultural-rural-finance.html
- Microfinance Gateway (2014): Highlighting noteworthy publications and key resources on rural and agricultural finance. In: Gateway Guide to Rural and Agricultural Finance. Retrieved from http://www.microfinancegateway.org/library/gateway-guide-rural-and-agricultural-finance
- AFRACO, FAO, the Land Bank of South Africa and the World Bank (2009): Expert Meeting in Managing Risk in Financing Agriculture. Johannesburg, South Africa. Retrieved from http://siteresources.worldbank.org/EXTARD/Resources/336681-1252501755087/Joburg_proceedings.pdf
- Bandyopadhyay, A. (2007): Credit Risk Models for Managing Bank's Agricultural Loan Portfolio. Pune, India. In: Munich Personal RePEc Archive (MPRA) 5357. Retrieved from https://mpra.ub.uni-muenchen.de/5357/1/MPRA_paper_5357.pdf
- Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH (2011): Agricultural Finance – Trends, Issues and Challenges. Retrieved from http://www.ruralfinanceandinvestment.org/sites/default/files/06__giz2011-0460en-agricultural-finance.pdf
- International Finance Corporation (IFC) (2011): Scaling Up Access to Finance for Agricultural SMEs Policy Review and Recommendations. Washington D.C., USA. Retrieved from https://www.ifc.org/wps/wcm/connect/04da89804a02e2e19ce0fdd1a5d13d27/G20_Agrifinance_Report.pdf?MOD=AJPERES
- International Finance Corporation (IFC) (2012): Innovative Agricultural SME Finance Models. Washington D.C., USA. Retrieved from http://www.ifc.org/wps/wcm/connect/55301b804ebc5f379f86bf45b400a808/Innovative+Agricultural+SME+Fi- nance+Models.pdf?MOD=AJPERES
- Mees, M. & Destrait, F. (2015): Guarantee Funds: A Response to Agricultural Credit Risk – The Latin American Guarantee Fund. SOS Faim Belgium. In: Zoom Microfinance 44. Retrieved from https://www.microfinancegateway.org/library/guarantee-funds-response-agricultural-credit-risk-–-latin-american-guarantee-fund
- Prasoon, P. K., Pareek, A., Natu, A. J., Ledesma, J. & Barman, N. D. (2014): Resource Book on Designing & Delivering Agriculture Financing Products. Retrieved from http://www.microsave.net/files/pdf/Designing_Delivering_Agriculture_Financing_Products.pdf
- SOS Faim (2013): Developing rural finance through public-private sector cooperation. In: Zoom Microfinance 40. Retrieved from https://www.sosfaim.lu/en/publication/developing-rural-finance-through-public-private-sector-cooperation/
