Inventory Credit

Country:

Niger / Practice Name: Inventory Credit

Title of the good practice:
Inventory credit, an innovative model for rural finance institutions in Niger to offer finance to agricultural producers and their organisations.

Synopsis of the good practice:
The Inventory Credit model is a technique for securing agricultural products by warrant. At harvest time, production cooperatives who want to get involved ask their members to deposit a part of their products in a warehouse as a guarantee to ask for a credit in a bank. Usually, farmers stock dry products such as millet, sorghum, beans, etc. However, gardening products like potatoes, and onions can also be warranted. The inventory credit system was first introduced in Niger in 1999 by FAO through its Agricultural Inputs Project. Initially, the objective was to respond to the lack of funding for agricultural inputs. Today, the model has gained a widespread recognition and is considered by farmers’ organisations, financial institutions, and development partners as an effective tool that can help reduce poverty in rural areas.

Objective of project/initiative:
The main objective of the inventory credit model is to identify and test innovative mechanisms that would support the promotion of the use of agricultural inputs, in particular fertilizers, by farmers and their organisations, and to establish technical-economic standards that would guarantee the appropriateness/reproducibility/durability of the application of inputs, all in order to assist the various actors along the line in the elaboration of a national level strategy, built on partnership, for improved farm input supply in support of a durable agriculture. Another objective of the model is to help reduce poverty and food insecurity in Niger as well as in the other countries of the Sahel region, through the FAO/Belgium 2008-2011 multilateral cooperation programme called “Knowledge and Gender Management”, thereby to fulfil the Millennium Development... [continues]

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