FARM CREDIT ADMINISTRATION

In 1933 the United States was mired in the Great Depression. President Franklin Roosevelt (1933–1945) instructed Congress to create the Farm Credit Administration (FCA) to assist agricultural workers who found loans and credit increasingly hard to come by during the difficult economic times.

Still functioning to this day, the FCA supervises the institutions that grant credit to farmers and ranchers and also coordinates the Farm Credit System. The Farm Credit System is a centralized banking system designed to serve U.S. agricultural interests by granting short- and long-term credit through regional banks and local associations.

The Farm Credit System was established in 1916. Its purpose is to provide dependable credit to agricultural workers. When the Great Depression arrived in the 1930s, farmers were hit hard. Farm property values dropped sharply and debt delinquencies grew quickly. Many of the loan companies involved with agricultural workers failed. Thus, when the Farm Credit Administration was created, the banks and associations comprising the Farm Credit System were supported completely by the federal government in an attempt to give the agricultural economy more stability in the uncertain day of the Depression. Today, these organizations are financed entirely by the sale of stock.

Franklin Roosevelt developed the Farm Credit Administration to unify all government farm credit programs under one agency. In addition to overseeing the Farm Credit System, the FCA also sets regulations, ensures compliance with established procedures, and has the authority to intervene when an institution violates those regulations.