A structured guide for National Development Banks to design and deploy effective financial and non-financial instruments for small-scale farmers.
How to use this playbook
The playbook contains 4 stages and 5 essential steps. Each stage builds on the previous one — starting from understanding the market, selecting the right instruments, planning delivery, building internal capacity, and sustaining impact through continuous monitoring. Click any stage below to explore its steps, tools, and real-world examples.
Each NDB must assess the specific barriers small-scale farmers face in their target market. These challenges fall into four categories — all of which ultimately result in limited access to financial services.
Land tenure insecurity, gender inequality in access to credit and training, weak farmer cooperatives with limited bargaining power, and reliance on informal markets with high dependency on middlemen.
Poor rural road networks, lack of storage facilities, limited market information on prices and demand trends, and weak position in value chains with heavy reliance on middlemen.
Increasing frequency of floods, droughts, and irregular rainfall. Limited access to modern equipment, low digital literacy, insufficient agricultural training, and lack of extension services.
FIRA's regional Technological Development Centres validate innovative agricultural practices with farmers and distribute learnings through social media videos — a farmer-to-farmer model that significantly increases adoption of new technologies.
Financial instruments address farm assets (land, equipment, inventory). Non-financial instruments address farm management (farming methods, market access, cooperation). Solutions must be scaled to what farmers actually need and what the NDB can realistically offer — defining the final product mix.
FIRA's guarantee product offers 12 modalities within a single product framework — from priority segments to rural SMEs — with a minimum loan amount to ensure the instrument serves commercial rather than subsistence farmers.
The "Crédito 1x30" program offered loans at 1% interest over 30 years without financial literacy support. Within a year, NPLs soared to 25% — borrowers perceived the product as a grant, not a loan. A key lesson: ultra-concessional terms without financial education undermine repayment culture and the NDB's sustainability.
Distribution in rural areas depends heavily on local conditions. The NDB must answer three key questions: How to access clients? Physical or digital delivery? Direct or through intermediaries? The outcome defines the preferred way of offering the identified instrument.
With over 2,200 branches and transaction offices, Agribank can swiftly make credit accessible across multiple regions. However, limited digitization means it can only offer group-based lending for rural clients without collateral.
The Zarkhez-e platform enables end-to-end digital loan applications for small farmers — with 75% disbursed via closed-loop QR codes to certified agro-dealers, ensuring quality inputs reach farmers directly.
Before launching an instrument, the NDB must ensure its internal setup can support it. Four dimensions must be assessed — often in coordination with government bodies, MDBs, MFIs, or farmer cooperatives.
FIRA issued green, social, and sustainability bonds through its Sustainable Bond Framework, raising long-term capital from domestic and international investors. Proceeds fund climate resilience, financial inclusion, and rural development — enabling FIRA to offer long-tenor credit for CAPEX that banks cannot match.
BDP's 0.5% interest product became loss-making because its cost of funds exceeded its lending rate. Without government subsidy or MDB concessional funding, the product was financially unsustainable — illustrating why funding must be considered at design stage, not after launch.
Implementation is not the end. Every instrument must be embedded in a continuous improvement cycle. The NDB launches in a pilot region, monitors through field feedback and digital tools, and iteratively refines the product before scaling — staying aligned with national development goals throughout.
BDP's climate risk system sends WhatsApp weather alerts to farmers, helping them plan farming and harvesting — directly reducing crop losses and improving loan repayment capacity. However, the system's vulnerability model was not yet integrated into credit decisions, a gap identified for improvement.
A recurring finding across all six countries: no NDB had a comprehensive impact measurement framework. Most measured only what was required by external funders (e.g. green bond certification). Building an all-encompassing development impact framework remains a priority for the execution phase.