| Abstract |
A major obstruction in the development of sustainable agriculture is the weakness of the financial and banking sectors in supporting smallholder farming. While farmers need to invest in their farms, they struggle to find credit schemes adapted to their specific needs. This study explores the literature on a range of credit systems applied in different geographical and historical contexts to analyse the underlying drivers of their successes or otherwise. In light of this review, the study investigates a farmers' association, Alfredo Namitete (AN), in Mozambique, offering a range of agroecology credit modalities. It is then assessed as to whether a new business model initiated with seed funding could be self-managed by the association itself and lead to greater autonomy. The AN pilot tested three schemes between 2015 and 2019. Based on the findings, i.e., better production, increased revenue and greater self-determination, the study combines elements for a new business model for small-scale lending. It concludes that to be effective, a credit scheme needs to meet several conditions simultaneously: believe in the genuine will to repay, abolish the lender-borrower distance, ensure a role for women in decision making, add a savings mechanism, combine individual and collective investments and, finally, reserve funds for solidarity and climate issues. |