November 11, 2020

CBN issues guidelines on private sector agric loan

Absence of off-takers stalls CBN’s support to fishery sector

Godwin Emefiele, CBN Governor.

…As banks guarantee 26,830 agric loans worth N3.6bn

Godwin Emefiele, CBN Governor.

By Elizabeth Adegbesan

Banks have guaranteed 26,830 loans worth N3.6 billion to farmers under the Agricultural Credit Guarantee Scheme Fund (ACGSF) in ten months (January to October) 2020.

Meanwhile, the  Central Bank of Nigeria (CBN)  has just rolled out guidelines for private sector in agriculture to access loans on the federal government’s Accelerated Agriculture Development Scheme (AADS).

The  apex bank,  in its latest report on the activities of ACGSF covering January to October 2020 said 1,923 loans worth N572.3 million was guaranteed for livestock farmers, 531 loans worth N135.5 million for fishery, and 5,925 loans worth N541.6 million were guaranteed for mixed farming.

Others are 16,976 loans worth N1.9 billion for food crops farming, 1,942 loans worth N345.5 million for cash crops farming, while 333 loans worth N69.9 million was guaranteed for other types of farming.

The ACGSF was established by Decree No. 20 of 1977, and started operations in April, 1978.

The Fund, managed by the CBN, guarantees credit facilities extended to farmers by banks up to 75 percent of the amount in default net of any security realized.

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Meanwhile, the guidelines on AADS released yesterday stated among other things that the  agricultural commodities eligible for consideration under the Scheme are rice, maize, cassava, cotton, wheat, tomato, poultry, fish, sorghum, oil palm, cocoa, livestock/dairy and any other commodities as may be listed by the CBN from time to time.

On eligibility criteria, the apex bank said: “Private sector-led AADS (P-AADS) participants must be existing or new firms engaged in agricultural production with proven capacity and bankable proposal; possess acceptable title for contiguous lands of not less than 20 hectares; have good credit record; be able to provide the required collateral for participation; and provide evidence of capacity to cultivate a focal commodity directly or engagement of farmers, including youths as in-growers or out-growers to cultivate on the land after clearing.”

Vanguard News Nigeria