New software speeds up risk assessment process in Azerbaijan's agricultural sector

Business Materials 26 June 2020 12:52 (UTC +04:00)
New software speeds up risk assessment process in Azerbaijan's agricultural sector

BAKU, Azerbaijan, June 26

By Fidan Babayeva – Trend:

Azerbaijan Micro-finance Association (AMFA) introduced an online software system for speeding up the process of analysis and risk assessment of the domestic agricultural sector in order to facilitate lending to small and medium-sized enterprises by non-bank credit organizations in 2020, Chairman of the association Jalal Aliyev said in an interview to Trend.

According to him, AMFA is interested in the application of new business models. In particular, the microfinance market requires the use of advanced financial and digital technologies.

“We decided to start arrangements for the implementation of the CLARA system, developed by International Finance Corporation (IFC) to accelerate the lending process, for all credit organizations of the country that are AMFA members,” Aliyev said. “The CLARA system, designed specifically for lending to the agricultural sector, will provide companies with high-quality analysis of applications. The innovation tool is applied via consulting from IFC, which is part of the World Bank Group.”

The chairman added that after the introduction of this program, when issuing agricultural loans, the process of analysis and risk assessment, as well as decision-making for all microfinance organizations in the agricultural sector will accelerate.

“The CLARA system can currently be applied to 50 species of plants and livestock. The leading non-bank credit organizations engaged in agricultural lending, such as Agrarkredit CJSC, Inkishaf uchun Maliyya LLC, Viator Mikrokredit Azerbaijan LLC and Qafqaz Kredit LLC have already started using CLARA,” he concluded.

Microfinancing was introduced in Azerbaijan in the mid-1990s to meet the economic needs of up to 1 million internally displaced persons (IDPs) and refugees, as a result of the Nagorno-Karabakh conflict.

In 1996, the International Non-Governmental Organizations (INGOs) began offering microfinancing services to low-income households and war-affected people to create income and employment opportunities.

The INGOs began to meet informally to exchange business experience and remove restrictions on the provision of loans with interest rates. In December 2001, members of INGOs decided to consummate the group as an association, which will serve as the focal point for microfinance in Azerbaijan.

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