Results of Agriculture Market Research in Azerbaijan

Results of Agriculture Market Research in Azerbaijan

Since December 2015, AZAFF team is having face-to-face interviews with farmers all around Azerbaijan and collecting agronomic data to feed AzALES. The team has decided to turn the advantage of being on the field into an opportunity to conduct a brief market study elaborating financing patterns, market concentration, demands and perceptions of Azerbaijani farmers. The following results are based on 123 interviews conducted between December 2015 and February 2016.

88.1% of farmers interviewed referred to the “repayment schedule not in line with their production cycles” as the biggest constraint for not working with financial institutions. This is a clear sign that Azerbaijani financial institutions are allocating credits without considering the agricultural production cycles and cash flow of farmers. With the adjustment of the lending policies of financial institutions and use of tools such as AzALES, this problem could easily be solved.

Lack of collateral is cited by 50.8% of respondents followed by lack of income for repayment (43.2%). A deeper analysis of respondents who selected “others” (20.3%) shows that they all cited high interest rates as the biggest constraint. Despite the constraints perceived, an overwhelming majority of respondents (96%) would consider applying for the loan from a financial institution for their financial needs if offered at appropriate terms and conditions.

Loan Terms Desired

Average Loan Amount Requested

AZN 22,639

Average Loan Maturity Requested

62.8 months

Average Interest Rate Requested


Currency of Loans

100% in AZN

Although not asked specifically, 38.1% of respondents noted that they request a grace period as well. Farmers were also asked whether they would provide any collateral to back up their loan applications. 42.4% of farmers interviewed are willing to provide at least one specific form of collateral. Real estate (58%), land (50%) and automobile (18%) are the three most commonly referred collateral types among the respondents.


Our Partners

The technical assistance funds of the project are provided by the EU Neighborhood Investment Facility.

This project is financed by the European Bank of Reconstruction and Development (EBRD).

The technical assistance services within the project are provided by Frankfurt School of Finance and Management.