State of Agricultural Finance in India

Agricultural finance has come a long way in the past 15 years. After the concerted efforts of GOI, supported by RBI and NABARD, towards doubling of agricultural credit flow in 2004¬¬¬¬--2005, the growth in credit flow to the sector has been robust with an impressive CAGR of 18% between 2004--2005 and 2019--2020. While outreach increased, the Terms of Trade (Farmers and Non-farmers) has largely been on a declining trend, reflecting the underlying stressed conditions in farming. There is a challenge of inclusion, where small and marginal farmers continue to struggle for suitable and affordable credit products and access. This book summarizes the current state of agricultural finance in India, highlighting policy blind spots and grey areas. It documents the important advancements made in the agri-finance space in the last few years. The book covers various aspects of Agri-Finance Policy; institutional appetite and architecture for agriculture credit; formal financial services for enterprises in agriculture; agri-business, including FPOs; and innovations in credit, insurance, delivery mechanisms for agri-sector.

Insurance claims and audit quality: evidence from trade credit insurance in Chinese listed firms

PurposeUsing unique trade credit insurance data from China, we examine whether trade insurance claims are associated with audit efforts and audit quality.Design/methodology/approachThe paper is based on a sample of Chinese firms to study insurance claims of trade credit insurance that affects abnormal audit fees.FindingsIn this study, we find that firms with high insurance claims pay higher abnormal audit fees. Further, our findings indicate that firms with high insurance claims have a short audit report lag and tend to select local audit firms.Originality/valueTo the best of our knowledge, this is the first study to investigate the association between trade credit insurance claims and audit efforts. In addition, we contribute to the literature on the agency cost of abnormal audit fees.

Dualism of Credit Insurance and Suretyship Management by General Insurance Companies and Guarantee Institutions

This paper aims to investigate the dualism of the regulation of credit insurance and suretyship. The scope of research is General Insurance Company and Guarantee Institution. Insurance business by general insurance companies in Indonesia is not only limited to business lines as regulated in Law Number 40 of 2014 concerning Insurance, but also carries out Credit Insurance and Suretyship businesses. On the other hand, there are Guarantee Institutions that carry out similar activities based on Law Number 1 of 2016 concerning Guarantees. The results of the study found that the dualism of the administration was detrimental to the Guarantor Institution. The method used is normative juridical with the data obtained in the form of regulations related to general insurance, guarantee institutions and financial services authorities. The conclusion is that the Financial Services Authority as the Non-Banking Business Regulator must be able to guarantee the implementation of Credit Insurance and Suretyship Businesses by General Insurance Companies based on Financial Services Authority Regulation Number 69 of 2016 concerning Business Operations of Insurance Companies, Sharia Insurance Companies, Reinsurance Companies, and Sharia Reinsurance Companies .

Export credit insurance in a transitional economy: Evidence from China

China is the world’s largest exporter, and is also one of the few economies that have successfully transitioned from central-planned to market-oriented economy. In this paper, we analyze the effect of China’s official export credit insurance on Chinese exports to countries in the world. We describes the background of official export insurance in general and the development of China’s ECI. Meanwhile, we discuss the data and model used to examine the relationship between China’s ECIs and exports. We estimate both the static and dynamic gravity models where exports are a function of country size, transportation costs, and country-risk. Our results of static model suggest that that a 1 percent increase in China’s official ECI coverage stimulates its exports volume by 0.34 percent. Furthermore, Chinese companies export 1.5 times more to countries with ECIs than to those countries where ECIs are not available. Our estimates from the dynamic model are similar to the static model, to a lesser extent, of ECI impacts on exports to trading partners.