Financing the Harvest: FAO Global and Regional Trends in Agricultural Credit (2015-2024)
SDG 2: Zero Hunger | SDG 8: Decent Work and Economic Growth | SDG 1: No Poverty
Ministry of Agriculture and Farmers’ Welfare | NABARD
The Food and Agriculture Organization (FAO) Analytical Brief No. 116 (2026) examines global and regional agricultural credit trends over the decade ending in 2024. While real-term credit to agriculture increased by 33% (from USD 961 billion in 2015 to USD 1,274 billion in 2024), the sector’s share in global total credit declined slightly from 2.44% to 2.25%, indicating that agriculture is being outpaced by faster-growing industries. The sector’s Agricultural Orientation Index (AOI) for credit remained low at 0.54, indicating that agriculture receives only about half the credit its economic contribution would suggest.
Key global findings include:
The “Asian Century” in Agri-Finance: Asia now dominates global agricultural credit, with its share rising from 47% in 2015 to 60% in 2024. Conversely, Europe’s share dropped from 28% to 20%.
Intensified Credit Use: The global ratio of credit relative to agricultural value added—a key measure of financial intensity—rose from 0.28 to 0.32. This suggests that more capital is being deployed to generate the same unit of agricultural output.
Economic Concentration: High-income countries still maintain significantly higher credit-to-value-added ratios (around 0.57) compared to low-income countries (averaging just 0.05), highlighting a persistent global financing gap.
Vulnerability to Shocks: Despite growth, the sector remains sensitive to interest rate hikes and climate-related disruptions, which threaten the stability of long-term lending in developing regions.
What is the ‘Agricultural Orientation Index (AOI)’ for credit? It is a measure used to track the parity between agriculture’s economic importance and its share of credit. An AOI of 1 means the sector receives credit exactly in proportion to its contribution to GDP. Globally, the AOI remained stagnant at 0.54 through 2024, meaning agriculture consistently receives only about half of the credit it should based on its economic weight, signaling a systemic “under-financing” of food systems.
Policy Relevance
As the primary contributor to Asia’s lead in agricultural credit, India’s performance is central to global food security targets and the SDG 2.a (increased investment in agriculture).
Strategic Impact for India:
Scaling Financial Intensity: India’s shift toward high-value agriculture and technology adoption requires a higher credit-to-value-added ratio. Policymakers must ensure that credit moves beyond simple crop loans to long-term capital investment in cold chains and processing.
Addressing the AOI Gap: While Asia leads in volume, the low AOI suggests that Indian agriculture still faces competition from the manufacturing and services sectors for institutional credit.
Incentivizing Private Capital: With global trends showing a decline in the agricultural share of total loans, India may need to introduce new Agri-Fintech regulations to de-risk lending for private banks and NBFCs.
Climate-Resilient Financing: Following the FAO’s focus on vulnerability, India’s Kisan Credit Card (KCC) system needs to integrate “weather-indexed” credit limits to protect farmers from the rising frequency of extreme weather events.
Follow the full report here: FAOSTAT ANALYTICAL BRIEF 116 Credit to agriculture