Do you know how rural financing works? What are the main advantages, main interest rates, benefits, and who is entitled to apply for this type of credit? We have gathered a series of information that may answer your questions about this.
For those who are not yet familiar with this line of financing, follow this special article to understand its main characteristics, who can actually apply, what the criteria are for approval and much more.
Rural credit is financing intended for rural producers, whose activities involve the production and/or marketing of products from the agricultural sector.
To make things easier for you, we will talk about rural credit from the perspective of Banco do Brasil, as we understand that it is one of the most practical ways to obtain this rural credit.
Banco do Brasil provides credit lines suited to the needs of rural producers who wish to invest in their agribusiness and increase their agricultural production.
See below everything you need to know about rural financing.
How does Rural Financing work?
Just like other financing (car, motorcycle, real estate, loan), rural financing has its own particularities and works according to the Bank's current rules.
Through BB, it works with the Pronaf, Pronamp, Funcafé, FCO programs and other options that Banco do Brasil offers, the rural producer can finance production expenses, invest in improvements, tractors, machinery and agricultural implements, in addition to selling their production.
Therefore, rural credit solutions contribute to increased productivity, improved cash flow and reduced costs.
Rural Credit for Funding Banco do Brasil
We know that life in the countryside involves extensive activities that need to be the farmer's priority, however, as we know, there are external concerns, mainly financial, that interfere with the time that the rural producer dedicates to his harvest.
And of course, it was with this in mind that Banco do Brasil decided to present solutions for producers who need financial resources, whether to facilitate rural activities or cover emergency expenses. The cost credit lines finance the production cycle expenses at any time during the activity.
Therefore, you can apply for credit directly in the Application.
Rural Investment Credit
On the official Banco do Brasil website you can find out about the various lines of rural credit for investment from BB that allow the acquisition of goods essential to the production and modernization of Brazilian agriculture, such as machinery, tractors, irrigation and storage.
But you can also acquire BB rural credit lines through the BB Investimento Agro Digital app. Only BB is Agro Digital!
Agricultural Marketing
We also know that to commercialize production, you can count on credit lines that allow better control of cash flow.
This way, with money in your pocket, negotiating better conditions for selling your production becomes easier.
Considerations for obtaining credit
Here we understand some important concepts and rules for obtaining credit from BB. Just look: the classification of the applicant for obtaining credit is done by the financial institution itself.
Therefore, it is understood that this classification is carried out based on the rural producer's registration data, and defines access to different resources and programs and what rates will be applied to credit operations.
However, as far as we know, in cases where the producer is a beginner or has had a failed harvest, the annual gross revenue is calculated based on a year of normal production.
Producer Classification Annual Gross Agricultural Revenue (RBA)
Small producer Up to R$ 360,000.00
Medium producer Above R$ 360,000.00 up to R$ 1,760,000.00
Large producer Above R$ 1,760,000.00
Revolving working capital credit for rural producers
This aspect of rural financing is very important to understand. BB Giro Agro is a revolving credit for working capital for agricultural activities, in addition to rural credit.
Therefore, in this way, you can use it to acquire goods or inputs used in rural activities, whether in the production, commercialization, processing or industrialization phases of agricultural products.
Rural financing is released at the customer's request through transfer to the deposit account, with the possibility of partial releases, amortization and reuse of capital.
How does the National Rural Credit System work?
The National Rural Credit System (SNCR), created in 1964 by law 4,595, has as its main agents banks and credit cooperatives, which are divided into basic, linked and articulated bodies.
- The SNCR is made up of the following basic bodies:
- Firstly, it is constituted by the Central Bank of Brazil
- Soon after by Banco do Brasil S/A
- Then by Banco da Amazônia S/A
- And finally, by Banco do Nordeste S/A
In addition, the SNCR has as linked bodies the National Bank for Economic and Social Development (BNDES), private and state banks, savings banks, rural credit cooperatives and credit, financing and investment companies.
An important thing to understand in this process: as articulated institutions, the SNCR has official bodies for regional appreciation and provision of technical assistance.
Every year, the Brazilian federal government makes an amount available for financing and marketing through the Harvest Plan. This plan covers the period from July 1 of the current year to June 30 of the following year.
Interest Rates for Rural Financing
In very general terms, we can say that Rural Credit helps thousands of Brazilian producers with the necessary resources to invest in their property and in obtaining the best inputs for production.
Good news regarding rural financing
Banco do Brasil announced last Thursday, the 20th, that it will release R$15 billion for pre-funding of the 2020/2021 harvest. The resource is used for the advance purchase of inputs. The institution informs that the resources are intended for rural producers to finance soybean, corn, cotton, coffee, rice and sugarcane crops.
Source: Bank of Brazil
By: Wanderson Dutch