The Impact of Bank Financing Mechanisms on Achieving Agricultural Development: Between Reality and Challenges A Case Study of the Bank of Agriculture and Rural Development in M’sila Cumulative Period up to 31/12/2025

Abstract

This study aims to analyse the reality of bank financing for the agricultural sector and its impact on agricultural development, using the various financing formulas available at the Bank of Agriculture and Rural Development (BADR) – M’sila branch as a model, and to measure the efficiency of their use. The study found that there is a disparity in the usage rates of financing services across different agricultural sectors due to differences in efficiency of use. The financial weight of investment activities with long cycles exceeds that of operational activities. Bank financing is an essential process, but it faces challenges, the most important of which are the difficulty of valuing bank guarantees (often agricultural land), default risk, and the mismatch between loan repayment schedules and the agricultural cycle. The study recommends introducing an incentive system for loan repayment, linking repayment to harvest times suitable for the farmer, accepting certain movable guarantees such as storable products (crops and agricultural produce), and encouraging agricultural insurance through state subsidisation of part of the insurance premiums, especially in the early stages of agricultural projects.