ACBA-Credit Agricole Bank and INECOBANK within the framework of the memorandum of cooperation with the RA Ministry of Agriculture start the subsidized agroloans

ArmInfo. The Armenian Agriculture Ministry announced the start of subsidized agro-credit programs. As the press service of the agency told ArmInfo, ACBA-Credit Agricole and INEKOBANK RA Ministry of Agriculture and the program implementation office for the economic development of rural communities signed memorandums on cooperation in the implementation of programs to subsidize interest rates of agrocredits.

Deputy Minister of Agriculture Ashot Harutyunyan participated in the signing of the memorandums. Director of the Office for the Implementation of Programs for the Economic Development of Rural Communities Vahe Harutyunyan, Deputy General Director of the ACBA-Credit Agricole Bank Norik Nazaryan, acting Executive Director of INECOBANK Garnik Tadevosyan.

ACBA-Credit Agricole Bank has signed memorandums on cooperation in the implementation of programs for subsidizing interest rates on loans for the laying of intensive fruit and berry gardens, processed with the use of advanced technologies, and for the installation of drip irrigation and anti-hail systems. And with INECOBANK - a memorandum on cooperation in the implementation of the program of subsidizing interest rates on loans for the installation of drip irrigation systems. Under the programs, loans will be provided to both individuals and legal entities, including cooperatives and private entrepreneurs.

"The next step will be the signing by contracting companies of contracts with relevant banks, after which the beneficiaries will be able to submit applications for participation in programs to banks," A.  Harutyunyan said. He noted that today in Armenia there are few fruit gardens cultivated with the help of modern technologies, but thanks to such programs, business entities will have the opportunity to engage in competitive agribusiness.

"In Armenia, the amount of damage inflicted by hail to agricultural crops often reaches 80-100% of the yield loss, the installation of anti-hail mesh will protect the gardens almost 100%, and the drip irrigation systems will allow about 50% less water," A. Harutyunyan explained.

The representative of the ACBA-Credit Agricole Bank, N.Nazaryan, added: "The branch network of the bank is leading by its presence in the Armenian regions, we were going to notify the farms about the new programs, but I think everyone already knew about these upcoming news and looked forward to the start projects ".

G.Tadevosyan in his turn noted: "Despite the fact that INECOBANK is not so active in terms of agro- credit, but there is a desire to participate in the implementation of programs that are aimed at the introduction of advanced technologies."

According to the Ministry of Agriculture of the Republic of Armenia, under the program of subsidizing interest rates on loans for the installation of anti-hail grids, loans will be issued with a maturity of up to 7 years, at a rate of up to 14% per annum, which will allow the granting of a loan to the client at a rate of 2%.  Under the program of subsidizing interest rates on loans for the laying of intensive fruit and vegetable gardens of 0.5-10 hectares, processed using advanced technologies, loans will be issued with a maturity of up to 7 years, at a rate of 5% per annum. Under the program of subsidizing interest rates on loans for the installation of drip irrigation systems, loans will be issued with a maturity of up to 3 years, at a rate of up to 14% per annum, subsidizing which will provide the client a loan at a rate of 2%.

According to the Financial Rating of Armenian Banks, prepared by IC ArmInfo, the volume of agricultural loans as of October 1, 2017 reached 147.8 billion drams or $ 309 million with an annual decline of 4.4%, and only 9 months of 2017 - 2%. ACBA-Credit Agricole Bank acts as the indisputable leader in agricultural lending, covering 47% of the total (or 69.5 billion drams), while INECOBANK accounts for more than 1% or 1.5 billion drams (with annual growth of 15.4%).