HOW CAN WE OFFER CREATIVE FINANCING FOR OUR LOW INCOME FARMERS?
HOW CAN WE OFFER CREATIVE FINANCING FOR OUR LOW INCOME FARMERS? For decades, we have been hearing about government loan programs intended to help low-income farmers buy seeds, fertilizers, farm machinery and other production inputs. Yet despite all these announcements, many of our small farmers still cannot access the capital that they desperately need. Why is that? Is it because they cannot comply with the documentary requirements? Is the approval rate so low that the programs fail to reach those who need them most? If so, perhaps the problem is not the farmers but the design of the lending programs themselves. There is certainly no shortage of demand. What appears to be lacking is a financial product that truly matches the realities of farming. Banks still operate with what I call a "pawnshop mentality"—no collateral, no loan. Unfortunately, many low-income farmers till land they do not own and therefore have little or nothing to pledge. Fortunately, innovative ideas are be...