Annual Report 2007

A n n u a l R e p o r t 2 0 0 7
Special Feature
Agricultural Loans in Mozambique
Mozambique has vast agricultural potential;
of its 48 million hectares which are suitable for
farming, only about 10% is currently exploited.
The agricultural sector contributes 23% to GDP
and employs 78% of the population. Despite
their importance to the country’s economy, farmers
and rural enterprises face serious difficulties
in accessing finance. To address this acute shortage,
Banco ProCredit Mozambique introduced an
agricultural lending facility in March 2007. The
product enables farmers and other producers to
purchase seed, livestock, equipment and other
inputs, leading to improved working conditions,
better crops and higher yields.
To gain the requisite knowledge and skills to
implement this project, the bank obtained the
support of a colleague from Banco ProCredit
Nicaragua who shared his experience regarding
market research, the launch of the product, and
the recruitment and training of agricultural loan
officers and middle managers. We introduced
the product gradually, starting in towns where
the bank already has a branch and where there
is a proven market for agricultural loans. It was
launched at the Chimoio branch in Manica province,
in the central part of the country. The area
in the vicinity of the branch has many potential
clients, a relatively stable climate and fertile land
with a good water supply for irrigation.
In the first month, the Chimoio branch disbursed
nearly 47 agricultural loans, worth USD 70,100.
Based on this success, the bank expanded agricultural
lending to three other branches: the one
in Xai-Xai, covering the areas of Chokwé and