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| − | {{SPIS Finance}}{{Back to SPIS Toolbox}}
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| − | === '''<span style="color:#879637;">Credit Policy: Risk Analysis</span>''' === | + | {{SPIS Finance}}{{Back to SPIS Toolbox}}<br/> |
| − | [[File:SPIS-in-India.jpg|thumb|right|300px|SPIS in India (Source: Lennart Woltering)]] | + | |
| − | Every SPIS demands a specific solution, since it combines a new energy providing technology with irrigation and cropping systems which can be manifold in its combination.<br/> | + | === '''<span style="color: rgb(135, 150, 55);">Credit Policy: Risk Analysis</span>''' === |
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| | + | [[File:SPIS-in-India.jpg|thumb|right|300px|SPIS in India (Source: Lennart Woltering)]] Every SPIS demands a specific solution, since it combines a new energy providing technology with irrigation and cropping systems which can be manifold in its combination.<br/> |
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| | Therefore, there are no standard “off the shelf” solutions, a thorough loan analysis is indispensable, especially when starting with this loan type. | | Therefore, there are no standard “off the shelf” solutions, a thorough loan analysis is indispensable, especially when starting with this loan type. |
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| | *Financing agriculture as such has specific risks. | | *Financing agriculture as such has specific risks. |
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| − | '''Technology Risks '''(see the following modules '''[[SPIS_Design|DESIGN]]''', '''[[SPIS_Set_Up|SET-UP]]''', '''[[SPIS_Maintain|MAINTAIN]]''' for further details). | + | '''Technology Risks '''(see the following modules '''[[SPIS Design|DESIGN]]''', '''[[SPIS Set Up|SET UP]]''', '''[[SPIS Maintain|MAINTAIN]]''' for further details). |
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| | *High value cropping and water saving irrigation technology is needed; | | *High value cropping and water saving irrigation technology is needed; |
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| | '''Framework Risks''' | | '''Framework Risks''' |
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| − | *Long term availability of water and good groundwater management is indispensable; (see '''[[SPIS_Safeguard_Water|SAFEGUARD WATER]] '''module) | + | *Long term availability of water and good groundwater management is indispensable; (see '''[[SPIS Safeguard Water|SAFEGUARD WATER]] '''module) |
| | *People involved – loan officers, producers, (gender!) technology and service providers, agricultural advisors; | | *People involved – loan officers, producers, (gender!) technology and service providers, agricultural advisors; |
| | *Theft or misuse. | | *Theft or misuse. |
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| − | === '''<span style="color:#879637;">Outcome/Product</span>''' === | + | === '''<span style="color: rgb(135, 150, 55);">Outcome/Product</span>''' === |
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| | *Credit risk policy, considering thorough single case assessment, adequate portfolio management and pro-active closing of the information gap. | | *Credit risk policy, considering thorough single case assessment, adequate portfolio management and pro-active closing of the information gap. |
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| − | === '''<span style="color:#879637;">Data Requirements</span>''' === | + | === '''<span style="color: rgb(135, 150, 55);">Data Requirements</span>''' === |
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| | *Specifics to agri-lending liquidity patterns of borrowers; | | *Specifics to agri-lending liquidity patterns of borrowers; |
| | *Asset structure of borrowers (potential for collateral); | | *Asset structure of borrowers (potential for collateral); |
| | *Cropping patterns and profitability of crop types (alternative markets and water availability); | | *Cropping patterns and profitability of crop types (alternative markets and water availability); |
| − | *Organization & management reliability (see '''[[SPIS_Maintain|MAINTAIN]] '''module); | + | *Organization & management reliability (see '''[[SPIS Maintain|MAINTAIN]] '''module); |
| − | *Technology risks (see '''[[SPIS_Design|DESIGN]]''' module); | + | *Technology risks (see '''[[SPIS Design|DESIGN]]''' module); |
| | *Re-financing options for the region. | | *Re-financing options for the region. |
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| − | === '''<span style="color:#879637;">People/Stakeholders</span>''' === | + | === '''<span style="color: rgb(135, 150, 55);">People/Stakeholders</span>''' === |
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| | *Management of financial service providers; | | *Management of financial service providers; |
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| | *Research and training institutions (e.g. environmental agency). | | *Research and training institutions (e.g. environmental agency). |
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| − | === '''<span style="color:#879637;">Important Issues</span>''' === | + | === '''<span style="color: rgb(135, 150, 55);">Important Issues</span>''' === |
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| − | *Consider SPIS specific risks with respect to their long term financing requirements, technological implications (cf. '''[[SPIS_Design|DESIGN]] '''module), environmental impact (cf. '''[[SPIS_Safeguard_Water|SAFEGUARD WATER]] '''module) and framework conditions. | + | *Consider SPIS specific risks with respect to their long term financing requirements, technological implications (cf. '''[[SPIS Design|DESIGN]] '''module), environmental impact (cf. '''[[SPIS Safeguard Water|SAFEGUARD WATER]] '''module) and framework conditions. |
| | *Assume manifold SPIS settings - there is no “off the shelf” loan analysis. | | *Assume manifold SPIS settings - there is no “off the shelf” loan analysis. |
| | *Minimizing risks can result in potentially high(er) transaction costs for all parties involved, compared to conventional pumping systems. | | *Minimizing risks can result in potentially high(er) transaction costs for all parties involved, compared to conventional pumping systems. |
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| − | | + | <br/>{{SPIS Reference}} |
| − | {{SPIS Reference}} | + | |
Every SPIS demands a specific solution, since it combines a new energy providing technology with irrigation and cropping systems which can be manifold in its combination.
Therefore, there are no standard “off the shelf” solutions, a thorough loan analysis is indispensable, especially when starting with this loan type.
SPIS, being based on agricultural activities, follow specific liquidity patterns, such as:
This requires specific agri-lending tools. Thereby the following risks should be considered:
