CROP RECEIPTS AS ALTERNATIVE FINANCIAL INSTRUMENTS

Vlado Kovačević; Irena Janković; Jelena Minović

doi:10.5937/ekoPolj2203849K

Authors

Vlado Kovačević Institute of Agricultural Economics, Belgrade, Serbia https://orcid.org/0000-0002-2902-6496
Irena Janković University of Belgrade – Faculty of Economics, Belgrade, Serbia https://orcid.org/0000-0003-1115-4702
Jelena Minović Institute of Economic Sciences, Belgrade, Serbia https://orcid.org/0000-0001-6254-4888

DOI:

https://doi.org/10.5937/ekoPolj2203849K

Keywords:

Agricultural finance innovations, Cédula de produto rural, Crop receipts, Pre harvest financing

Abstract

The aim of the paper is to provide insights into the lending against crop receipts mechanism. Crop receipts emerged as promising financial instruments creating an additional type of collateral for agricultural producers that pledge their future agricultural production in order to finance ongoing production activities. At the same time, they offer an alternative investment opportunity to banks through the creation of a new asset class. European Bank for Reconstruction and Development supported Serbia in establishing a crop receipt system with the aim to serve as a pilot project for Europe. This is the first analysis of the crop receipts system in Serbia. The methodology applied consists of interviews with bank representatives, extensive literature research, descriptive statistics and comparative analyses. Results are indicating that the main shortcomings in the crop receipts system include the lack of specialized shareholders’ knowledge, the absence of subsidization of interest rates on loans against crop receipts followed by the lack of appropriate Central bank policy, standardization and securitization

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