Rice Inventory Credit in Madagascar: Conditions of Access and Diversity of Rationales around an Hybrid Financial and Marketing Service

This paper examines the access and use of a rice inventory credit product called Grenier commun villageois (GCV) among the members of the Malagasy rural finance network, CECAM. GCV is fully collateralized by the debtor's rice stock, which is held jointly by the local CECAM branch and the GCV users for the duration of the loan. The study analyzes quantitative and qualitative data collected during a four-year impact study, and finds that:

• GCV is the most popular credit product among CECAM members;
• Clients appreciate its flexibility in collateral requirements, easy filing procedure, and rigorous warehouse monitoring;
• GCV is beneficial for all categories of members in terms of price differential;
• Poor households use the GCV as a savings device;
• Richer households use GCV to boost their monetary agricultural income;
• GCV helps all households to smooth consumption, engage in off-season productive activities, and invest in assets.

Finally, the paper recommends an improvement in credit officers' incentive systems, an increase in warehouse capacity and the development of more focused credit facilities for the most vulnerable to further improve GCV.