Crédito Agrícola historical background……
Portugal was one of the first countries to organize agricultural credit cooperatives and related associations.
Its origin lies in the “Holy Houses of Mercy”, founded in 1498, under the aegis of Queen Leonor, wife of D. Manuel I, and Friar Miguel Contreiras, as well in the “Communal Agricultural Warehouses/Common Barns”, created in 1576 by D. Sebastião, in the city of Évora. These credit organizations were designed to assist farmers in years of scarcity, advancing them the seeds for a certain interest that would be paid in kind. Note that only 100 years later appeared similar institutions in Scotland (1649) and over 200 years later in Germany (1765).
However, the importance of the “Common Barns” was decreasing as interest rates were rising. Money replaced the seeds around 1862 and these organisations came to resemble true credit institutions.
In the early 18th century, emerged new types of relationships in these institutions that were providing credit for production. Capital was now provided under a different umbrella: organisations that have developed into what is now the banking system.
Then, on March 1st, 1911, Portuguese Agricultural Cooperative Credit was set up. Consecutively to the 40’s, there was a great expansion of these institutions throughout the country, linked to farmers’ unions. It was intended to establish a credit policy for Portuguese agriculture in which the Agricultural cooperative Credit institutions were the focus and for which financial incentives would be channeled.
The founding of FENACAM…
However, after this period of growth, local Portuguese local cooperative banks experienced a phase of stagnation and crisis, which led them to submit to the supervision of the largest financial group of the portuguese State.
After the establishment of democracy, with the Revolution of April 1974, there was a move afoot to give back autonomy to those local cooperative banks, along with the scope to widen their activities as cooperative credit institutions, as in many countries across Europe. From this movement stemmed the National Federation of Agricultural Cooperative Credit Banks (FENACAM), with the function of supporting and representing nationally and internationally its members. The Federation will then have a key role in regaining autonomy for Crédito Agrícola.
Founded on November 29th 1978, by a group of 26 local banks, FENACAM was the first nationwide Agricultural Credit institutions structure to be created with the aim of defending the interests of local banks and to represent them in various levels and instances, introducing them to a new dynamic operation, set development objectives and requirements imposed by accelerated growth.
FENACAM undertook a comprehensive reform plan, being now the highest institution to represent, politically and institutionally Crédito Agrícola, both nationally and internationally.
At the same time the National Federation has created, developed and streamlined many services to support the activities of the local banks, some structural and with great impact on their activity.