Farmers across the country welcomed the nine per cent credit policy of the Central Bank of Nigeria (CBN) in agriculture, saying that it will help increase production if it is adequately sold.
Some of them, who spoke on Sunday with the Nigerian Information Agency (NAN) in Abuja, called on CBN to also ensure rapid monitoring of commercial banks to ensure effective implementation.
The NAN reports that, according to the new policies, agriculture, production and sectors that are seen as an incentive for growth and stimulation of employment, it is now possible to borrow a long period of up to N10 billion with a consolidated interest rate of nine percent.
On August 23, KBN issued a new credit policy called "Guide to Access to the Real Sector Support Fund (RSSF) using the cash reserve ratio (CRR) and corporate bonds."
Amina Goronjo, national president of the Rice Farmers Association of Nigeria (RIFAN), said that rice farmers in the CBN Anchor Borrowers Program (ABP) program have been using a 9 percent loan rate since 2015.
Mr. Goronjo expressed optimism that the policy will help improve the production of other agricultural products in this sector.
He said that the 9 percent rate on loans within the ABP contributed to an increase in rice production from two million to 3.5 million tons to nine million tons per year.
The National President advised farmers to enter politics to enable them to take advantage of this intervention.
"Prior to the unambiguous CBN interest rate, our products were no more than 2 million and 3.5 million tons per year, but today we produce almost nine million tons because of this intervention.
"I'm sure it will be the same for other products that will use this intervention," said Goronjo.
Lizzy Igbine, National President of the Agri-Women Farmers Association, told NAS that, although the level of lending at nine percent will encourage farmers to increase production, it is necessary to reduce it to five percent.
"We only ask for five percent, CBN still needs to do more.
"We have a long way to go to help us, but we hope that there will be no hidden rates or fees that farmers will pay after receiving loans," she said.
Tola Faseru, National President of the National Cashew Federation of Nigeria (NCAN), urged CBN not to allow politics to be a "lip service".
Mr. Faseru, who said that CBN is not the first time running commercial banks for agricultural lending, noted that most banks did not comply with this directive.
As he said, the majority of commercial banks considered agriculture for many years as very risky.
"I hope this will not be a rumor.
"I hope that commercial banks will agree with this, because there was a time when the CBN told them that out of their profits a certain percentage should go to agriculture and the manufacturing sector, but they never held back.
"Until now, most commercial banks have shied away from lending to agriculture, they like a quick business.
"They consider agriculture to be very risky, but it is here that we have comparative advantages as a country, so we need to develop the sector in order to be able to diversify the economy from oil.
"This is a very commendable CBN policy, and we approve of CBN for this, but we urge CBN to put a mechanism for checking compliance with commercial banks.
"I think that CBN has recently been strong in its controlling role of commercial banks.
"We hope that they will be able to monitor that the policy is implemented by commercial banks; it will go so as to help us grow agriculture and, indeed, the export sector, "he explained.
Chidike Uko, National Secretary for Advertising of the National Fish Association of Nigeria, said that the expectation of farmers for CBN continues to reduce lending rates by about five percent.
Mr. Ukug said that the lending rates for agricultural production are subsidized at about 2 percent in developed countries.
"When you have a mass production of food, industry will have raw materials, and the level of productivity will bring the total income in the economy.
"The gross domestic product (GDP) will be largely such a volume of production. We are doing business at five percent.
"If commercial banks observe a single figure, it will be very good. This development, which we need to observe, "- said the secretary for advertising.
The NAN recalls that the guidelines follow the recommendations of the CBN Monetary Policy Committee (CBM) at its 119th meeting, held between July 23 and July 24.
The MPC stressed the need to increase the flow of credit to the real economy to accelerate economic recovery.
NAN reports that the new policy marks a big departure from the regime of excruciating interest rates from 25 to 30 percent, which was accused of strangling agriculture, production and other enterprises in the country.