By KYIV. Sept 13 (Interfax-Ukraine) – PrivatBank, the insurance company Universalna and the United States Agency for International Development (USAID) announced the launch of a program to support micro, small and medium-sized agricultural businesses with a budget of about UAH 572 million to insure the future harvest and reduce credit risks, the USAID press service reported.
According to a press release, Ukrainian farmers and agricultural enterprises will be able to receive preferential bank loans from PrivatBank under guarantees of future crop insurance from the insurance company Universalna. USAID will provide grant funding to help pay for crop insurance.
Head of the USAID Financial Sector Reform project Robert Bond said the new financing mechanism would provide farmers with the working capital they lack to continue and expand their operations in wartime. It is expected that it will encourage greater innovation in financial services and tools for MSMEs. He believes this pilot project has great potential for scaling through future crop insurance.
It is expected that this program will allow additional financing for about 220 clients from among small agricultural producers with an average loan amount of UAH 2.6 million.
Member of the board of PrivatBank for SME issues Yevhen Zaihrayev emphasized that the agricultural sector is critically important for Ukraine during martial law, therefore, since the beginning of the war, the bank has increased the volume of financing for farmers by almost 4 times, and continues to actively lend to agricultural producers, especially small enterprises, and supports preferential financing programs for the industry.
At the same time, the financial institution is improving the timing of credit procedures and the conditions for obtaining a loan. According to him, almost all of PrivatBank’s loan offers can be obtained with interest compensation from the state or other programs.
For his part, deputy head of the board of Universalna Andriy Dubey noted that crop insurance is becoming an increasingly common condition among banking institutions for lending to farmers.
“Today, within the framework of the USAID program, several insurance products are planned: for the period of overwintering to the growing season, from the spring growing season to harvesting, and a comprehensive product that will include these two periods,” he specified.
