Credit unions deliver affordable finance to small
businesses and entrepreneurs around the world.
Digitization expands WOCCU’s impact,
expanding credit, and lowering cost and risk.
Loan Analysis & Monitoring of Rural Farmers’ Credit Worthiness - potential Analytic Software for Credit Union (Ukraine)
A core element of the lending process and portfolio management is the assessment of the creditworthiness of potential borrowers, including the efficient analysis of the borrowers’ ability to repay debt. Since 2016, credit unions in WOCCU’s USAID/Ukraine’s Credit for Agriculture Producers (CAP) project have been exploring various digital tools to inform credit decisions and effective loan monitoring for selected credit unions that focus on agricultural lending expansion.
First, we tested a Ukrainian-built software for online loan assessment; the initial pilot group of loans were disbursed to farmers for a total of 2 million Ukrainian hryvnia (US $75,000) through central credit unions and their regional branches. Unfortunately, the tool was not affordable for the credit unions at the time.
WOCCU is also cooperating with IFC's “Agrarian Receipts Project” in Ukraine, that allows farmers that work with the receipts to use IFC's tested tool “CLARA” that is being adapted to multi-crop smallholder agricultural production. WOCCU's project is discussing the possibility for testing of the tool by participating CUs. CLARA is a tool to quickly and efficiently assess production risks in agriculture. The service helps to make predictive calculations for farms based on production flow charts for various agricultural products.
De-risking Lending to Small Farmers - Android App for Credit Unions (Kenya)
WOCCU collaborated closely with the Agribusiness Unit of the Kenya Union of Savings and Credit Cooperatives (KUSCCO), a member of WOCCU, to develop the App which drives WOCCU’s innovative agricultural lending methodology. WOCCU & KUSCCO are continuing to improve the Android app, working on the web server databases, particularly on the crops, SACCO products information, and user categories (including the capabilities, rights, and reports shared with various users - including “Field Officer”, “SACCO Manager”, and “KUSCCO level”).
The application is designed to work offline but will require internet access before and after field visits/data collection to sync data for user log-in, fetching crop data and SACCO pending product information and any new changes to loan applications. The App includes space for the user to enter and update borrower information, project (farm) information, etc.
Farm and production mapping - App for loan support monitoring (Kenya)
To de-risk agricultural loans, WOCCU is testing new digital tools for credit union lenders to monitor the crop production of borrowers’ farmers.
In Kenya, WOCCU and KUSCCO is testing CropIn Technology Solutions’ “SmartFarm”, a web and Android application-based system for farm mapping and production monitoring. This helps credit unions to de-risk loans by enabling monitoring to support farmer’s access to loans. The application provides for a remote monitoring solution, including the capability to manage farms through standard production practices and activity logging; maintain logs of all alerts and management guides on pest and disease infestation; and includes functions for traceability and output predictability. When a farmer is selected for a loan, their farm is registered in this application by the KUSCCO officer.
Once a farm is added onto the system, SACCO staff can monitor production progress from their offices without the need to have routine field visits. Physical visits are only made when necessary because the system alerts credit officers when plants are performing poorly. The system also logs farm management activities and alerts users of when activities are due. SmartFarm monitors farms using satellite images.