How To Change Your Vision of Rural and Agricultural Finance

Emilio Hernández of CGAP gives us a preview of the upcoming Boulder RAFP training

Emilio Hernández leads CGAP’s work on financial innovation for smallholder families. He will be teaching two courses at the 3rd Annual Boulder Rural and Agricultural Finance Program (RAFP), which will take place from 17 July to 4 August 2017 in Turin, Italy. In this Gateway interview, he lets us know what to expect from this year’s training program.

Gateway: The Boulder Institute of Microfinance is set to host its third annual Rural and Agricultural Finance Program (RAFP) in July. CGAP is a prominent partner for this program. Can you tell us more about it? What does it seek to achieve and who is the target audience?

Emilio: The RAFP represents a global learning platform that brings together leading financial service providers, policy makers, regulators and donors, to exchange state-of-the-art knowledge on how to expand rural and agricultural finance markets in developing countries. It aims to develop capacities and build consensus among these targeted stakeholders so that they can return to their countries ready to define and implement strategies that promote further financial inclusion.

Gateway: Financial institutions and practitioners often lack the necessary knowledge on how to serve rural clients and manage agriculture-specific risks. What other constraints do financial institutions face when serving the agricultural sector, and in what ways does RAFP address some of those constraints?

Emilio: Knowing the financial needs of smallholder families – and how rural livelihoods shape these needs – allows providers to design products that are valuable for clients and have proper risk management strategies. In addition, these products need to be delivered in such a way that they can be scaled up. This has a lot to do with developing the right business models and exploiting digital technologies. New technologies can help to reduce costs and aggregate services from multiple providers in rural areas, so that the economics of financial intermediation work.

During the RAFP, we analyze different experiences from around the world to identify ways that client-centric rural financial services can be feasibly delivered by several partners, as well as identify the technological platforms that can be developed to facilitate this process.

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