Nine local govt launch agriculture credit fund to boost rural lending
Summary
Nine local governments in Nepal have launched a ring-fenced Agriculture Credit Guarantee Fund to enhance formal credit access for farmers and agricultural enterprises in underserved regions.
Key Points
- Nine local governments from Karnali, Sudurpashchim and Bagmati provinces have signed an agreement with the Deposit and Credit Guarantee Fund (DCGF) to establish a ring-fenced Agriculture Credit Guarantee Fund.
- The fund, launched with technical support from UNDP and collaboration from FAO, WFP and UNCDF, aims to improve access to affordable financing for farmers and agricultural enterprises, especially in food-insecure provinces.
- The guarantee fund will mobilise USD 2 million initially, with contributions from the UN Joint Programme, DCGF, and local governments to reduce lending risks and encourage banks to finance borrowers lacking conventional collateral.
- The initiative is expected to strengthen financial inclusion, promote resilient livelihoods, and support inclusive local economic development in Nepal's least-served regions.
