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This manual is positioned as a national reference tool and it provides structured frameworks, sector-specific risk assessment tools, and credit structuring strategies tailored to the realities of Nepal’s Agri-sector. It complements existing institutional policies and is supported by a digital Learning Management System (LMS), enabling integration into BFIs’ internal training programmes to ensure widespread knowledge transfer.
While agriculture contributes around 24% to Nepal’s GDP, access to formal credit for agri-businesses remains disproportionately low. BFIs often lack contextual tools and practical knowledge to confidently lend to the agricultural sector. Despite regulatory mandates encouraging Agri-lending, much of it remains compliance-driven rather than need-based.
The manual addresses this persistent mismatch by offering actionable, grounded guidance that aligns with the operational realities of Agri-Small and Medium Enterprises (SMEs) and smallholder farmers.
To enhance the existing Agri-lending practices in BFI’s, True North Associates commissioned by SDC project Sahaj held a series of discussion with the existing BFIs to understand the ground realities of why majority of small holder farmers and Agri-SME’s were not able to access Agri loans.
The insights from the discussions identified a critical knowledge gap where frontline banking staff lacked tools and sectoral understanding to assess and support agricultural loans effectively. The findings were used to design a national reference tool designed to build capacity across the financial sector.
The benefit of the manual extends to both BFIs and agri-businesses. For BFIs, it offers comprehensive guidelines on risk assessment, credit design, collateral evaluation, and portfolio monitoring, enabling more confident decision-making and better compliance with regulatory requirements such as the Nepal Rastra Bank’s mandate for 15% of lending portfolios to be directed towards agriculture by 2027.
For agri-businesses, the manual improves access to finance by helping agri-businesses understand their unique challenges, such as informal documentation and seasonal cash flows, and promotes a transparent and standardised lending practice.
During the panel discussion segment, Mr. Deepak Ratna Tuladhar, Programme Specialist in the Agri food systems and investment at Food and Agriculture Organisation (FAO) Nepal, highlighted, “To meaningfully scale agricultural lending, regional and ground-level bank staff must be equipped with technical knowledge. This manual helps fulfil that gap, but it will only be effective if BFIs are willing to invest in building their teams’ capacity.”
The event concluded with remarks from Cécile Rivière, Programme Manager at the Embassy of Switzerland in Nepal, who underlined the manual’s strategic importance.
Looking ahead, SDC project Sahaj and its partners will support the initial dissemination of the Agri-Lending manual to BFIs, cooperatives, and training institutions nationwide.
The Agri-Lending manual is a dynamic manual. In future, financial institutions can strengthen this manual by embedding changes as they adopt and start implementing the manual to train their staff. The more the manual is used for training purposes the stronger it becomes to support the financial institutions to strengthen their agricultural lending practices.
This manual was developed by True North Associates and commissioned by SDC project Sahaj.
Sahaj is a bilateral initiative of the Government of Switzerland and the Government of Nepal, implemented by Swisscontact (as lead agency) and Centre for Environmental and Agricultural Policy Research, Extension and Development (CEAPRED).