Although the volume of credit to productive activities is generally larger, interest charges remain high: between 10 and 12%.
The president of the Federation of Livestock of Nicaragua (FAGANIC), Salón Guerrero, believes that being a "development" entity, the Banco de Fomento should not charge the same interest rates on loans for productive purposes as private banks.
According to an article in Laprensa.com.ni,"Guerrero explains that the dissatisfaction with Produzcamos is due to the fact that although when it came into operation National Financial System (SFN) 'worked to make commercial banks adjust and lower interest rates, today private banks are more aggressive in offering better rates on some types of loans, which in some cases are in the range of 10 to 15 percent.’"
Source: laprensa.com.ni
More on this topic
June 2010
Development bank “Produzcamos” has $12 million available for livestock breeding loans, but it has only approved 5%.
Solomon Guerrero, from the Nicaraguan Breeders Association (Faganic), believes that the main problem is the long periods required to get a loan with the bank (almost two months).
August 2008
The livestock sector projected that it will close 2008 with $280 million in exports.
Representatives from the National Livestock Commission of Nicaragua (Conagan) and from the Federation of Livestock Associations of Nicaragua (Faganic) had a meeting yesterday with the head of the Ministry of Agriculture and Forestry (Magfor), Ariel Bucardo, to whom they expressed the "urgent need" for the Government to fulfill several demands presented by the farmers.
February 2011
The Production Development Bank will earmark $ 21 million this year for financing the livestock sector.
Considering the announcement, the Federation of Livestock Associations of Nicaragua (Faganic), mentioned the sector's difficulties in getting loans approved.
"... Joaquín Lovo, CEO of Produzcamos Bank, said the delays in approvals are mainly because most farmers have not updated their deed records of their properties which are as bank guarantee," reported Laprensa.com.ni.
March 2010
The Bank for Fostering Production (Produzcamos), will start operating on April 19, with an initial capital of $50 million.
Its main objective is to strengthen the country production with loans to micro, small and medium agricultural and industrial companies.
“Produzcamos will loan at a maximum interest rate of 12%, and no longer than 5 years”, reported Laprensa.com.ni.
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