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Credit unions may greatly contribute to dev't of Azerbaijan’s agriculture

Finance Materials 30 November 2018 09:29

Baku, Azerbaijan, Nov. 30

By Taleh Mursagulov - Trend:

The development of credit unions may greatly contribute to the development of the Azerbaijani agricultural sector, Chairman of the board of the Azerbaijan Credit Unions Association Jalil Suleymanov told Trend.

He said that credit unions in Azerbaijan are mainly aimed at financing the agricultural sector, because loans worth 2,000-3,000 manats are not a significant amount for other sectors of the country’s economy.

Landowners sometimes need such amounts for tillage and other work, he noted.

Suleymanov noted that in most cases banks aren’t interested in issuing loans to small and medium-sized enterprises (SMEs) in the Azerbaijani districts, with the exception of a limited number of entrepreneurs, and this is not widespread.

"There are 78 credit unions in Azerbaijan, and more than 80 percent of these companies are concentrated in the districts," he said.

Talking about the problems of credit unions, Suleymanov noted that the unions have problems with financing, while there is high demand in the market.

"There is high demand in the agriculture sector, particularly in the cotton industry," he said. "From the side of the cotton growers, high demand emerged for loans for the year in the amount of 1,000-2,000 manats in accordance with the turnover. However, credit unions avoid working in this direction."

Suleymanov noted that all credit unions of Azerbaijan operate with local capital and the share of problem loans in the total portfolio of unions is much lower than that of major credit organizations.

He also added that the Enterprise Development Fund of Azerbaijan operates closely with credit unions, monitoring is conducted and the fund has certain plans for working with unions.

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Follow the author on Twitter: @TalehMursagulov

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