Invest in AgroCredit loans and support farmers in Latvia

We are truly pleased to announce that we are now working with nonbank lender AgroCredit, which issues farmers loans secured with grain sale contracts. This collaboration between AgroCredit and Mintos will provide Latvian farmers improved access to financing.

AgroCredit’s clients are primarily grain farmers, who require financing for agricultural inputs, including seeds, fertilizer, chemicals, or fuel costs. Future grain sale contracts with AgroCredit partners act as collateral for these loans; once grain is delivered, funds are transferred to the lender’s account, paying down the farmer’s liabilities.

AgroCredit will place loans on Mintos marketplace with principal from EUR 5,000 to 100,000 and a repayment deadline aligned with the end of the season, e.g. fall of the year in question. In some cases, long-term loans with a repayment period of 5 years are also issued. Considering these are low risk loans secured with grain-supply contracts, the expected average net annual return will be 7-8%.

AgroCredit clients are both small and medium-sized farms, as well as large farms with several thousand hectares under management. Since beginning of operations in 2011, AgroCredit has issued loans to several hundred farmers in Latvia — to date providing more than EUR 20 million in loans.

Farming is one of the leading export industries in Latvia. Last year Latvia’s total grain harvest reached 3 million tons, of which the majority was exported. Agricultural export demand, coupled with AgroCredit’s lending process where repayment is received from grain delivery implies low credit risk for Agrocredit loans. This is evidenced by the fact that over the fast five years of operations, AgroCredit has not written off a single loan.

In evaluating client applications, AgroCredit analyzes the farms’ previous work, financial indicators, crops (area, location, culture, previous harvests and expected harvest, etc.), as well as requests recommendations from grain sellers. Loan usually does not exceed 50% of the expected value of the harvest. AgroCredit’s  loan portfolio as of Dec. 31, 2015 was EUR 4.1 million, but it is expected that by the end of the season, this will exceed EUR 6 million.

To date, necessary financing for Agrocredit business operations has been attracted from shareholders investments, as well as loans from banks, investment fund and private investors.

Invest in AgroCredit loans and support farmers in Latvia.


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