Agricultural microcredit

TL;DR

Colombia has subsidized agricultural credit lines with low interest rates (3-5% EA) for small producers, funded by public resources.
However, microcredit, despite its aim of inclusion, can lead to financial exclusion due to high interest rates and operating costs.
Rates for 'rural productive credit' can reach 18.65% EA, with usury limits at 27.98% EA, and even higher for 'popular productive rural credit' (50.88% EA to 76.32% EA).
These high rates, combined with seasonal income and agricultural volatility (prices, crops, climate), can turn loans into debt traps.
Barriers to accessing subsidized credit push farmers towards more expensive microcredit options.
Recommendations include improving access to subsidized credit, increasing its speed, and designing financial products that align with agricultural cycles and manage volatility through insurance and hedging.

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