CBN Publishes Revised Anchor Borrowers Programme Guidelines

CBN Publishes Revised Anchor Borrowers Programme Guidelines

 

1.0 Introduction

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Background

The Central Bank of Nigeria (CBN), in line with its developmental functions as enshrined in Section 31 of the CBN Act 2007, established the Anchor Borrowers’ Programme (ABP) to create economic linkages between smallholder farmers (SHFs) and reputable companies (anchors) involved in the production and processing of key agricultural commodities. The core of the Programme is to provide loans (in kind and cash) to smallholder farmers to boost agricultural production, create jobs, reduce food import bill towards conservation of foreign reserve.

The Programme evolved from consultations with stakeholders comprising Federal Ministry of Agriculture & Rural Development, state governments, agro-processors, commodity associations, financial institutions and smallholder farmers to ramp up agricultural production, boost non-oil exports and diversify the revenue base of Nigeria.

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The revised Guidelines address current realities and developments in the Anchor Borrowers’ Programme, aimed at promoting best practice in the implementation of the Programme. The Guidelines recognize the distinctiveness of smallholder farmers, the ABP transactions dynamics and the Project Management Team (PMT) in the implementation process. It also adopts measures to ensure the protection of smallholder farmers. It defines eligibility criteria 5 Classified as Confidential Classified as Confidential and responsibilities of relevant stakeholders under the Programme such as the loan limit, interest rate, tenor; agricultural commodities eligible for financing under the Programme. It outlines the implementation windows and operating models under each window type.

This document is therefore aimed at improving the Programme’s implementation process and enhancing stakeholders’ participation for the realization of the ABP’s objective.

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Objective

The broad objective of the ABP is to create economic linkages between smallholder farmers and processors with a view to increasing agricultural output and ensuring food price stability. The specific objectives include:

Increase banks’ financing to improve agricultural productivity by creating an ecosystem that drives value chain financing;

Reduce the nation’s food import bill through import substitution and enhanced domestic value addition;

Create new generation of farmers through innovative financing to support smart agriculture; and

Deepen financial inclusion and grow smallholder farmers from subsistence to commercial farming.

1.3 Targeted Beneficiaries

The targeted beneficiaries shall be smallholder farmers and medium to large scale farmers engaged in the production of agricultural commodities across the country. The smallholder 6 Classified as Confidential Classified as Confidential farmers should be in groups, cooperative(s), associations or under out-grower arrangement.

 

1.4 Targeted Agricultural Commodities

The agricultural commodities covered under the Programme shall include:

Cereals (Rice, Maize, wheat etc.)

Cotton

Roots and Tubers (Cassava, Potatoes, Yam, Ginger etc.)

Sugarcane

Tree crops (Oil palm, Cocoa, Rubber etc.)

Legumes (Soybean, Sesame seed, Cowpea etc.)

Tomato

Livestock (Fish, Poultry, Ruminants etc.)

Any other commodity that may be decided upon by the Bank from time to time.

Download Full Guidelines Here

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