TransUnion CIBIL and SatSure Launch CIBIL Credit and Farm Report (CCFR) to Expand Farmers’ Access to Credit
CCFR will enable credit inclusion of ~8.9 crore farmers who presently do not have access to formal credit
Mumbai, October 11, 2022 – TransUnion CIBIL, in collaboration with geo-spatial data analytics provider SatSure, has launched the CIBIL Credit and Farm Report (CCFR). This powerful solution will support lenders in improving the flow of credit to the agricultural sector using data oriented and digital credit assessment capabilities. The CCFR will lead to quicker and more astute decisions on agricultural lending, and will help drive speedier and efficient disbursement of credit to farmers, agricultural sector entrepreneurs, and businesses.
Agriculture is the largest component of India’s rural economy and access to credit in this segment is a significant growth driver for economic resurgence and financial inclusion. The country’s rural economy impacts ~55% of the country’s total workforce1 and contributes ~18.8% to its Gross Value Added (GVA)2. India’s agricultural credit portfolio stands at $192B, contributing 12.5% of gross bank credit3. Of this, 84% of credit comes from commercial banks4. However, insights show that only 39%1 of all Indian farmers borrow from formal sources, while ~63%1 of small and marginal farmers are unable to borrow from any formal source.
Agricultural credit reach and regional disparity (credit not in proportion to their share in agriculture output) are also cited as some of the key challenges in the Reserve Bank of India’s report by the working group on agricultural credit5. Other information challenges in agricultural lending include the lack of data on determinant credit parameters such as district-wise input cost for a crop, type of crops being grown, crop-wise sown area, the number/share of small and marginal farmers cultivating a crop, and data about allied activities being undertaken by small and marginal farmers.
The CCFR combines the power of credit information from TransUnion CIBIL and crop parameters based on geo-spatial data from SatSure to provide a holistic solution to lenders for making credit decisions on agricultural lending. It offers a digitally-powered and analytics-oriented ecosystem for agricultural financing and policy making, helping catalyze the rapid development of farming and agriculture across India. The CCFR can also help support regulators, policy institutions and stakeholders in India’s financial ecosystem with data analytics and insights for driving sustainable growth and financial inclusion in the agricultural sector.
Speaking on how the CCFR can help catalyze agricultural credit inclusion, the MD and CEO of TransUnion CIBIL, Mr. Rajesh Kumar, explained: “Of India’s 14.6 crore1 farmers, only 5.7 crore1 have accessed credit from the formal lending ecosystem. One of the key roadblocks for credit penetration in the agricultural sector is the unavailability of a single, holistic source of information for assessing credit risk and production risk. Now that the CCFR is making contemporary credit insights along with crop production and production risk parameters available, lenders will have a comprehensive view for astute agricultural credit risk management and policy implementation.”
Insights from TransUnion CIBIL also indicate that public sector banks hold over 70% of the agricultural credit portfolio while private banks (14%) and non-bank finance companies (NBFCs) (4%) hold comparatively very small portion – as seen in Chart 14. Non-availability of credible data through a single source could be a key challenge that these credit institutions may be facing while growing their agricultural lending portfolio.
“The CCFR provides parameterized credit details along with information about farm details and crop performance, ownership details, and other important regional metrics in a scientific manner derived from geo-spatial, remote sensing data along with government published APIs. The nuanced information in the CCFR offers credit institutions a one-stop view of borrowers and furthers the digitization of agri- loans to aid in quick disbursals, lowering appraisal costs, and increasing the user base,” concluded Mr. Prateep Basu, founder and CEO of SatSure.
Chart 2. CIBIL Credit and Farm Report – Information Parameters
1 Agricultural Statistics at a Glance 2020-21 -
2 Government of India Economic Survey 2020-21 - https://www.indiabudget.gov.in/economicsurvey/doc/eschapter/echap07.pdf
3 Reserve Bank of India - Reports - Sectoral Deployment of Bank Credit – July 2022 - https://rbi.org.in/Scripts/BS_PressReleaseDisplay.aspx?prid=54289
4 TransUnion CIBIL Market Insights
5 Report of the Internal Working Group to Review Agricultural Credit
About TransUnion CIBIL
India’s pioneer information and insights company, TransUnion CIBIL makes trust possible in the modern economy. We do this by providing an actionable picture of each person so they can be reliably represented in the marketplace. As a result, businesses and consumers can transact with confidence and achieve great things. We call this Information for Good®. TransUnion CIBIL provides solutions that help create economic opportunity, great experiences and personal empowerment for millions of people in India. We serve the financial sector as well as MSMEs, corporate and individual consumers. Our customers in India include banks, financial institutions, NBFCs, housing finance companies, microfinance companies and insurance firms.
For more information visit: www.transunioncibil.com
SatSure offers three main decision intelligence products: a) SatSure Sparta: a platform for providing agriculture and climate-related insights on open innovation, freemium model; b) SatSure SAGE: life cycle risk monitoring and business intelligence product suite for agriculture banking; c) SatSure SKIES: high-resolution satellite imagery-based infrastructure change detection product suite.
For more information visit: https://www.satsure.co/