Three lending models of global agricultural supply chain finance

Abstract: Supply chain finance can effectively solve the problem of information asymmetry between borrowers and lenders, and the three mainstream models include the cooperation between agricultural supply chain enterprises and P2P, public welfare P2P lending for farmers and commercial P2P lending. Although the practice in the field of supply chain finance in developed countries has been quite mature, forming three business models dominated by logistics enterprises, core enterprises in the production chain and commercial banks, there are not many attempts to test supply chain finance in agriculture. At present, the three mainstream models include the cooperation between agricultural supply chain enterprises and P2P, public welfare P2P lending for farmers and commercial P2P lending. The first model is represented by the cooperation between Danish food retailer COOP and P2P platform MYC4. COOP is one of Denmark's top food retailers, owning and managing five production supply chains, while MYC4 is a well-known P2P platform in Denmark that connects European investors with agricultural micro-enterprises and individual farmers in developing countries, the former providing microfinance to the latter. The basic model of the whole business chain is: COOP has cooperated with MYC4 in a project called "Commodities from Africa". COOP has put MYC4 website link on its official website to direct its consumers to P2P platform and participate in African projects that apply for loans on MYC4. The projects on MYC4 are selected by local cooperative credit institutions (credit provider) in Africa, and African farmers applying for loans provide COOP with a large and continuous supply of agricultural products through MYC4 financing and reproduction, while using part of the proceeds from the sale of agricultural products to repay the loan. In addition, COOP has also set up an "Africa Fund" to return African commodities sold in the autumn of 2010 to the fund in the amount of 0.5 euros per piece to help "suppliers" in Africa ". The second model is a public welfare lending platform for farmers, typically represented by KIVA in the United States, which is also the world's first public welfare P2P network credit platform. In 2003, Matt Flannery (Matt Flannery) and Jessica (Jessica Jackley), inspired by Muhammad Yunus (Muhammad Yunus), the father of small loans, founded KIVA in October 2005 to lend investors' idle funds to poor people around the world who are eager to change their fortunes or start businesses. Agriculture accounts for a large part of KIVA loans, the founders hoped to supplement agricultural development by providing interest-free loans to farmers at the bottom of the entire agricultural supply chain. KIVA also works with local small lenders and other organizations working to change poverty to screen eligible borrowers and then post projects online through the website to provide loans. At present, the platform has borrowed a total of 684,633,175 US dollars, with a repayment rate of 98.75 per cent. The third model is more common, but it also lacks strong pertinence, that is, ordinary commercial lending platforms, such as well-known foreign P2P platforms such as Zopa in the United Kingdom, Prosper and Lending Club in the United States, are all individual-to-individual loans and investments. Investors indirectly participate in agricultural supply chain finance through direct loans to farmers or individuals engaged in agriculture-related industries. Some scholars in China believe that supply chain finance can effectively solve the problem of information asymmetry between borrowers and lenders. For agriculture with deep-rooted traditional genes, the effect of transformation will be more obvious. At the same time, it will help individual farmers who are in a traditionally disadvantaged position. Significant. Compared with the mature development of supply chain finance in manufacturing and retail in developed countries, the fertile soil of agricultural supply chain finance is still to be developed, and there are many excellent cases and experiences in related fields in China that are worth learning. He Kun, general manager of Silicon Valley Hopu (Beijing) Financial Information Service Co., Ltd., believes that supply chain finance uses the credit advantages of the core enterprises to connect the logistics, information flow and capital flow of the whole chain, which is lower than the risk of a single credit and is the core value embodiment. 2015/4/16 China Agriculture News Network lixia