IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v14y2022i23p16090-d990962.html
   My bibliography  Save this article

Potential and Complexity of Implementing Financial Instruments in the Framework of Rural Development Policies in Italy—The Friuli Venezia Giulia Revolving Fund

Author

Listed:
  • Federica Cisilino

    (Council for Agricultural Research and Economics, Research Centre for Agricultural Policies and Bio-Economy, 00187 Rome, Italy
    These authors contributed equally to this work.)

  • Francesco Licciardo

    (Council for Agricultural Research and Economics, Research Centre for Agricultural Policies and Bio-Economy, 00187 Rome, Italy
    These authors contributed equally to this work.)

Abstract

Although in recent years some credit institutions have shown a willingness to support agricultural entrepreneurs, there is still a lack of private financing or co-financing in the agricultural sector. Many farms, in fact, are not able to meet the indicators or to provide the fees required by banks to obtain investment loans. The financial instruments introduced by the European Commission within the Rural Development Programme aim at supporting access to credit for farms to make them more economically viable, competitive, and suited to market requirements. The objective of this paper is to analyze the role played by the financial instruments introduced by the European Union to support and encourage the improvement of farms and, in general, the agriculture, forestry, human capital, and rural development in Italy. The paper explores the topic in detail by presenting a case study of a region that has successfully applied these instruments using a revolving fund with a special background. The quantitative data used in this study are administrative; some information was obtained through a survey. Regional information on the implementation of this fund is examined in terms of both opportunities and limitations to highlight the best practice. The findings suggest that certain conditions are required to develop and implement effective financial instruments: a real and effective collaboration between regional administration, banking institutions, and farms that are willing to grasp the newness; a reasonable period of time (some years); know-how because knowledge and experience are crucial, together with the ability to face complexity both in terms of normative issues and financial engineering instruments themselves. Several implications derive from these findings.

Suggested Citation

  • Federica Cisilino & Francesco Licciardo, 2022. "Potential and Complexity of Implementing Financial Instruments in the Framework of Rural Development Policies in Italy—The Friuli Venezia Giulia Revolving Fund," Sustainability, MDPI, vol. 14(23), pages 1-21, December.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:23:p:16090-:d:990962
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/14/23/16090/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/14/23/16090/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Allen N. Berger & W. Scott Frame, 2007. "Small Business Credit Scoring and Credit Availability," Journal of Small Business Management, Taylor & Francis Journals, vol. 45(1), pages 5-22, January.
    2. Carillo, Felicetta & Licciardo, Francesco & Corazza , Eugenio, 2021. "Investments financing at farm level: A regional assessment using FADN data," Economia agro-alimentare / Food Economy, Italian Society of Agri-food Economics/Società Italiana di Economia Agro-Alimentare (SIEA), vol. 23(3), December.
    3. Felicetta Carillo & Francesco Licciardo & Eugenio Corazza, 2021. "Investments financing at farm level: A regional assessment using FADN data," Economia agro-alimentare, FrancoAngeli Editore, vol. 23(3), pages 1-24.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Simon Cornée, 2014. "Soft Information and Default Prediction in Cooperative and Social Banks," Journal of Entrepreneurial and Organizational Diversity, European Research Institute on Cooperative and Social Enterprises, vol. 3(1), pages 89-103, June.
    2. Ono, Arito & Hasumi, Ryo & Hirata, Hideaki, 2014. "Differentiated use of small business credit scoring by relationship lenders and transactional lenders: Evidence from firm–bank matched data in Japan," Journal of Banking & Finance, Elsevier, vol. 42(C), pages 371-380.
    3. Sun, Xiaoyan & Xie, Xuanli, 2024. "How does digital finance promote entrepreneurship? The roles of traditional financial institutions and BigTech firms," Pacific-Basin Finance Journal, Elsevier, vol. 85(C).
    4. Cristina Bernini & Paola Brighi, 2011. "Relationship Lending, Distance and Efficiency in a Heterogeneous Banking System," Working Paper series 41_11, Rimini Centre for Economic Analysis.
    5. Pietro Alessandrini & Andrea F. Presbitero & Alberto Zazzaro, 2010. "Bank size or distance: what hampers innovation adoption by SMEs?," Journal of Economic Geography, Oxford University Press, vol. 10(6), pages 845-881, November.
    6. Enrico Beretta & Silvia Del Prete, 2007. "Bank consolidation and lending policies to small business: Differences across geographical areas," Temi di discussione (Economic working papers) 644, Bank of Italy, Economic Research and International Relations Area.
    7. Inderst, Roman & Mueller, Holger M., 2007. "A lender-based theory of collateral," Journal of Financial Economics, Elsevier, vol. 84(3), pages 826-859, June.
    8. Florian Heider & Roman Inderst, 2012. "Loan Prospecting," The Review of Financial Studies, Society for Financial Studies, vol. 25(8), pages 2381-2415.
    9. Stefano Filomeni & Michele Modina & Elena Tabacco, 2023. "Trade credit and firm investments: empirical evidence from Italian cooperative banks," Review of Quantitative Finance and Accounting, Springer, vol. 60(3), pages 1099-1141, April.
    10. Allen N. Berger & Adrian M. Cowan & W. Scott Frame, 2009. "The surprising use of credit scoring in small business lending by community banks and the attendant effects on credit availability and risk," FRB Atlanta Working Paper 2009-09, Federal Reserve Bank of Atlanta.
    11. Ferri, Giovanni & Murro, Pierluigi & Pini, Marco, 2020. "Credit rationing and the relationship between family businesses and banks in Italy," Global Finance Journal, Elsevier, vol. 43(C).
    12. Cornelli, Giulio & Frost, Jon & Gambacorta, Leonardo & Jagtiani, Julapa, 2024. "The impact of fintech lending on credit access for U.S. small businesses," Journal of Financial Stability, Elsevier, vol. 73(C).
    13. Francesco Fasano & Tiziana Rocca, 2024. "Does the bank-firm human relationship still matter for SMEs? The game-changing role of digitalization," Small Business Economics, Springer, vol. 62(1), pages 159-178, January.
    14. Kgoroeadira, Reabetswe & Burke, Andrew & Di Pietro, Francesca & van Stel, André, 2023. "Determinants of firms’ default on unsecured loans in the P2P crowdfunding market," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 89(C).
    15. James R. Barth & Glenn Yago & Betsy Zeidman, 2006. "Stumbling blocks to entrepreneurship in low-and-moderate income communities," Proceedings: Community Affairs Dept. Conferences, Federal Reserve Bank of Kansas City, issue Jul, pages 91-155.
    16. Arráiz,Irani & Bruhn,Miriam & Stucchi,Rodolfo Mario, 2015. "Psychometrics as a tool to improve screening and access to credit," Policy Research Working Paper Series 7506, The World Bank.
    17. Berger, Allen N. & Udell, Gregory F., 2005. "A more complete conceptual framework for financing of small and medium enterprises," Policy Research Working Paper Series 3795, The World Bank.
    18. Novita Puspasari & Eliada Herwiyanti, 2021. "SME’S Accounting Information in the Eyes of Bank Credit Analyst: Exploration with ZMET Method," Academic Journal of Interdisciplinary Studies, Richtmann Publishing Ltd, vol. 10, November.
    19. Min Bai & Samir Harith, 2023. "Measuring SMEs Risk – Evidence from Malaysia," SN Business & Economics, Springer, vol. 3(7), pages 1-32, July.
    20. Dimitra Michala & Theoharry Grammatikos & Sara Ferreira Filipe, 2013. "Forecasting distress in European SME portfolios," DEM Discussion Paper Series 13-2, Department of Economics at the University of Luxembourg.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:14:y:2022:i:23:p:16090-:d:990962. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.