Farmers to Receive N432b non-interest CBN loans

Farmers to Receive N432b non-interest CBN loans

The central bank of Nigeria (CBN) said it will soon release the guideline for the disbursement of sum N432 billion non-interest loans to farmers as part of efforts to further integrate non-interest finance into the national financial structure and boost the country’s agricultural development agenda.

The CBN said it had been concluded work on the non-interest funding document that the policy guideline that will outline how farmers with bias for alternative finance could apply and benefit from its agricultural programmes will be issued soon and the loans will be channeled through Anchor Borrowers’ Programme (ABP) and Targeted Credit Facility (TCF) to support households and Micro, Small and Medium Enterprises (MSMEs) affected by the COVID-19 pandemic.

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The apex bank said it plans to fund the value chains of nine commodities in the 2020 wet season, some of the commodities to be funded are rice, maize, livestock, fish, oil palm, cowpea and poultry among others.

These were disclosed by CBN’s Director, Corporate Communications, Isaac Okorafor and Director, Development Finance Department, Yila Yusuf, who jointly represented the CBN Governor, Mr. Godwin Emefiele, at a stakeholders’ meeting to review the successes recorded under the ABP and the strategies for the 2020 agricultural wet season.

According to Okorafor, the creation of a non-interest loan is response to appeals by concerned stakeholders for farmers across the country to also be considered for funding under the non-interest window.

Okorafor said the bank, in the 2020 agricultural wet season, was committed to aggressively fund its agricultural programmes and spur farmers along select crop value chains to prevent the country from sliding into a recession, as is currently being experienced in some major economies of the world.

Yusuf, said the target for the 2020 agricultural wet season was to advance about N432 billion, through the participating banks, in the value chains of nine commodities, that over 1.1 million farmers, cultivating over one million hectares of farmland, were expected to benefit from the loans that will help to produce a collective output of 8.3 million metric tons.

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He explained that the focus for the 2020 wet season is to ensure the provision of improved seeds to incentivize the farmers to return to their farms, that the CBN adopted the value chain approach across all the commodities to ensure that every player along the entire value chain, from the farmers through to the processors, was financed.

He said the bank’s funding of the ABP for the 2020 season was the highest since the inception of the programme in 2015, adding that this was quite significant considering the successes recorded in the 2019 season that contributed to shielding Nigeria from any food shortage, particularly rice, in the heat of the global lockdown during which some major producing countries of staples, such as rice, closed their silos and halted the export of those produce from the shores of their respective countries

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Present at the meeting, the Presidents of the Rice Farmers Association of Nigeria (RIFAN), Alhaji Alhaji Aminu Goronyo; National Cotton Association of Nigeria (NACOTAN), Mr. Anibe Achimugu; Maize Association of Nigeria (MAN); Maize Association of Nigeria (MAAN), Alhaji Bello Abubakar; and the Maize Growers, Processors, and Marketers Association of Nigeria (MAGPMAN), Dr. Edwin Uche, all commended the success of the ABP, that it enhanced the value chains of their respective commodities.

The presidents of the associations, pledge their support to the continued implementation of the ABP to generate employment and create wealth, they promised to ensure that the loans collected by farmers were promptly recovered in order to sustain the programme.

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