Strengthening Access to Finance for Agribusiness in Egypt

The economic implications of several crises facing the Egyptian economy are substantial. Access to finance and liquidity will be a key element for MSMEs in the current situation.

The agriculture sector is the Egyptian economy's backbone, forming around 12% of the GDP and 25% of the labour force. Nevertheless, the country is still a substantial net importer of agricultural products in spite of an agri-export volume of more than 3 billion USD. Meanwhile, the financial sector has a low level of know-how and risk appetite for agricultural finance. Agricultural credits constitutes only 2% of total credits to private sector. This is due to lack of sectoral expertise and technical capacity of the Egyptian FIs. Agriculture has its own sectoral dynamics and financial needs which cannot be easily met through conventional and traditional financial schemes. Without proper know-how and institutional capacity, financing the sector is considered to be risky.

GIZ and Frankfurt School of Finance & Management have designed a comprehensive series of online seminars for the Egyptian banking sector, to be coupled with a consulting facility (for interested banks) to equip Egyptian banks with necessary knowledge and skills around agricultural finance. The online seminars will be conducted in ten sessions and are open for participation for all banking sector professionals, at all levels (head office, regions, branches). The topics will follow a top-to-bottom approach to cover all necessary knowledge and tools for agricultural finance.

Banks joining the online sessions can also choose to receive individual technical advice for deep dive in agricultural finance. This will provide an opportunity for Egyptian FIs to establish / strengthen their internal capacity for further development of a sustainable and profitable agricultural business segment and portfolio. Further details are provided in below second tab for interested banks.

Online Seminars

The length of each session is approximately 2 hours. The modules and sessions are built on one another. We therefore encourage you to attend the full programme.

All times are displayed in Egypt Standard Time.

Read more about the module content below:

Session Topic	Date & Time	Trainer

Session 1: Overview on Agricultural Macro Trends in the World and Egypt Rural population vs. agriculture demand \| Transformation of agriculture sector \| Agricultural demand in the world and in Egypt \| Agricultural supply and productivity \| Climate change \| Lessons from Covid and Ukraine-Russia war \| Input and output prices \| Financing agriculture	26.09.2023, 10:00 - 12:00	Ömer F. Demirhan
Session 2: Introduction to Egyptian Agricultural Markets Agricultural and food economy of Egypt \| Agricultural finance in Egypt \|Rural sector in Egypt \| Agricultural zones and seasons in Egypt \| Climate conditions in Egypt \| Main agricultural products and productivity in Egypt \| Farmer typologies in Egypt \| Agricultural cooperatives in Egypt	03.10.2023, 10:00 - 12:00	Fadi Abdelradi
Session 3: Agricultural Production and Value Chains Agricultural concepts and definitions \| Agricultural production types and methods \| Crop/vegetable/fruit farming in general and in Egypt \| Dairy cow farming in general and in Egypt \| Cattle fattening in general and in Egypt \| Sheep farming in general and in Egypt \| Poultry production in general and in Egypt \| Agricultural value chain definition and mapping \| Key players in agricultural value chains	10.10.2023, 10:00 - 12:00	Fadi Abdelradi
Session 4: Sustainability, Energy & Resource Efficiency in Agriculture Social, environmental, economic, and financial sustainability \| Achieving total factor productivity \| Mitigation and adaptation practices addressing climate change \| Conservation agriculture, sustainable land management \| Irrigation \| Renewable energy use in farming \| Energy & resource efficient mechanization \| Digitalization in agriculture: mobile, satellite, precision farming \| Sustainable post-harvest practices \| Standardization and certification for agrifood products \|Sustainable, green, and inclusive agri-finance, community-based finance \| Sustainability data collection for FIs	17.10.2023, 10:00 - 12:00	Helmut Grossmann
Session 5: Agricultural Finance Marketing Distinctive characteristics of agriculture sector for finance sector \| Why agricultural finance? \| Finance suppliers in Egypt \| Cash flow structure of a farm \| Agricultural income \| Agricultural cost and working capital requirement \| Agricultural profitability in Egypt \| Agricultural lending cycle \| Who is a good farmer to lend? \| Agricultural loan application \| Farm visits; important points during farmer meetings and farm visits \| Marketing channels for agri-finance	24.10.2023, 10:00 - 12:00	Ömer F. Demirhan
Session 6: Agricultural Value Chain Finance What is a value chain? \| Price formation in agricultural products \| Flows and products within value chains \| Actors and key players in agricultural value chains \| Tight vs. loose value chains, contractual farming \| Challenges in traditional finance and responses from VCF \| Steps in developing VCF schemes \| Content of VC Business and VCF Analyses \| VCF models \| Financial products / services that can be presented for VCF schemes \| Roles of banking units in VCF schemes \| Practical hints and clues	31.10.2023, 10:00 - 12:00	Katia Goertz
Session 7: Agricultural Lending What does a bank need for agricultural lending? \| Agricultural credit policy and segmentation \| Agriculture finance organization for FIs \| Agricultural data collection \| Standardization and automation of agricultural lending, a case from Egypt \| Loan documents \| Agricultural loan types and differentiation \| Agricultural credit cards \| Agricultural investment loans	07.11.2023, 10:00 - 12:00	Ömer F. Demirhan
Session 8: Agricultural Credit Assessment 5Cs in agricultural lending \| Credit history analysis \| Agricultural loan terms and conditions \| Ideal farm lending level for working capital and investment loans \| Calculating farm income, cost, net income \| Cash flow analysis for agricultural loans \| Deciding agricultural loan limits \| Agricultural loan disbursement	14.11.2023, 10:00 - 12:00	Ömer F. Demirhan
Session 9: Agricultural Credit Risk Management Risk factors for farmers \| Agricultural credit scoring \| Performing and non-performing periods of a loan \| Main reasons for problem loans \| Monitoring agricultural loans \| Early warning signals in agricultural loans \| Diagnosis for Overdue Loans \| Actions before NPL \| Restructuring agricultural loans	21.11.2023, 10:00 - 12:00	Ömer F. Demirhan
Session 10: Non-Financial Services for Agricultural and Rural Enterprises Capacity building for farmers and farm laborers \| Financial literacy \| Business management skills \| Digital literacy and solutions \| Location-based services \| On-site technical assistance \| Sustainability solutions \| Specialized “agricultural bank branches” \| Campaigns and outreach	28.11.2023, 10:00 - 12:00	Ömer F. Demirhan

Target Audience

Employees of financial institutions in Egypt are the core target group and direct beneficiaries of this webinar series.

Certificate

Participants who attend more than 80% of the sessions will receive a certificate of participation.

Register for the online seminar series below. Session links will be sent to you via email after registration.

Register Here

Consulting Facility

This Facility is a complementary support for the FIs which want to receive additional and further individual advice on agricultural finance in relation to the topics presented in online webinars.

Banks can request advisory support for different topics according to their needs. Advisory support is divided into two according to development level of banks in agricultural finance in line with their expertise and know-how. This is to ensure a tailored approach and maximise efficiency of this facility. Banks who already have a significant progress and portfolio can receive more advanced technical assistance. Other banks who aspire to advance in agricultural finance can request fundamental support to gain ground and make a breakthrough.

1. Specialist Banks in Agriculture

• Workshop on current dynamics of and future prospects for agricultural finance in light of climate change, land consolidation, mechanisation, digitalisation, etc.

• Review and recommendations on FI’s current agricultural finance policy and procedures

• Analysis and enhancement of agricultural loan products and other financial services

• Developing physical and digital marketing and campaign strategies for agricultural loans,

• Support for value chain finance development for a selected crop/animal

• Agricultural clients and credits portfolio analyses

• Support for reviewing and upgrading current agricultural credit appraisal and scoring systems

• Reviewing agricultural credit monitoring and risk management policies and procedures

• Strengthening agricultural finance organisational capacity in marketing and lending

• Reviewing and developing job descriptions and requirements for agricultural relationship managers (RMs) and/or loan officers (LOs) at head office and/or branch level

• Reviewing performance criteria and incentive system for agricultural RMS and/or LOs

• Updating agricultural training and talent management curriculum

• Developing / strengthening non-financial and digital services for agribusinesses

• Others (please specify)

2. Evolving Banks in Agricultural Finance

• Workshop on strategic importance of agricultural finance in light of food security, rural migration, climate change, mechanisation, digitalisation, etc.

• Support for development of an agricultural lending product(s) or credit card

• Physical and digital marketing and campaign strategies for agricultural loans,

• Introduction to value chain analysis and value chain finance development

• Support for development of a dedicated and written agricultural finance segmentation and credit policy

• Support for development of agricultural credits procedures and manuals (content-wise)

• Mapping current MSME client portfolio and MIS system for quick wins in agricultural finance

• Support for reviewing current MSME credit appraisal and scoring system for suitability to agricultural finance

• Introduction to agricultural loans evaluation and financial analysis methodologies, agricultural data collection and income-cost calculation

• Support for a dedicated monitoring and early warning system for agricultural loans

• Strengthening organisational and HR capacity for agricultural finance

• Developing an agricultural training and talent management curriculum,

• Support for development of non-financial and digital services for agribusinesses

• Others (please specify)

Head office units of banks in Egypt are the core target group and direct beneficiaries of this Facility. Among all, marketing and product development, credit underwriting, and credit risk management departments are the most relevant units which can apply from below form to benefit from this opportunity. Requests to receive consulting will be accepted until 31 October 2023. However, FIs are advised not to wait until then and apply as soon as possible, since there will be a selection process by the GIZ subject to time and budget limitation of this facility.

Interested FIs in both categories should write and explain their requested topic through the form below. Selected FIs will be approached by the consultants for arranging a short call for final designation of the topic and timeline.

Applications for the technical assistance have now closed.