‘Only Genuine Farmers Should Benefit From CBN’s Zero-Interest Facilities’

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Stakeholders in the agricultural sector have commended the Central Bank of Nigeria (CBN) on the various Initiatives put in place in the country to ensure that the country is self-sufficient in food production. 

They gave the commendation following the recent announcement by the CBN of a planned integration of non-interest credit facilities into the Anchor Borrowers’ Programme (ABP), the Targeted Credit Facility (TCF) and other agricultural credit schemes. 

They were quick to sound a note of caution to the apex bank to ensure that political farmers are excluded from benefitting from the initiative and that only genuine farmers should have access to the scheme through their various associations across the country. 

The stakeholders further warned that impostors, politicians and charlatans should be prevented from hijacking scheme meant for real farmers to actually boost food production and reduce poverty amid the COVID-19 pandemic. 

Samuel Akinade, Chairman, Oyo State chapter of Rice Farmers Association of Nigeria (RIFAN), said the scheme is a good start. 

He said experience had shown that avoidable food imports do take away a bulk of the country’s foreign reserves. 

“If this is properly channeled, it will encourage the smallholder farmers to stay on the farm. They will feel the senses of belonging as their operations are recognised as important.” 

Akinade added that the country would be able to use the available reserves only on very essential items that the country could not produce locally and, as time goes on, it would earn more for the nation. 

“My recommendation here is that we don’t need to concentrate more on the youths much for now if we don’t want to fail. We should let the youths emerge. Let them grow along with the elderly farmers, no matter their educational or training backgrounds in agriculture,” he said. 

Dr. Richardson Okechukwu , a cassava value chain agronomy specialist with the International Institute of Tropical Agriculture (IITA), said it is an excellent way to facilitate agricultural enterprises that have for long been neglected. 

He added that the government should ensure recipients are linked to off-takers and utilise improved seeds of good varieties along with quality inputs. 

He also suggested mechanisation as important to agriculture. 

“A shift from hoe and cutlass is long overdue. This intervention, if handled well, will create jobs and reverse rural urban migration. Beneficiary farmers should endeavour to repay back their loans, which luckily, are interest-free, to ensure the facility is extended to other farmers.” 

The apex bank and other stakeholders recently launched an initiative to mitigate the impact of COVID-19 on food production in the country increase production by about 10 million metric tonnes within a year. 

The joint venture, in partnership with the private sector through some out-growing schemes, involves farmers and off-takers to ensure value chain development of the crops, boost farmers’ income through access to improved inputs. 

Also, Kebbi State chairman of the Rice Farmers Association of Nigeria (RIFAN), Mr Augie Sahabi, said the initiative is a welcome development, saying, “I hope that steps will be taken to ensure that only true farmers will be registered to benefit.” 

He said removal of interest from the loan would attract more Muslim farmers who hitherto avoided bank loans with interest due to religious prohibition. 

Prof. Lateef Sanni, Project Manager, IITA, BASICS-II and former Deputy Vice Chancellor of the Federal University of Agriculture, Abeokuta (FUNAAB), while commenting on the scheme, said, “This is a laudable programme that has potential of helping over two million farmers between July 2020 to October 2021 in the first instance, and may snowball into helping over five million farmers from 2021 onward.” 

Sanni added that the non-interest facility would remove the aspect of five to nine per cent of economics of production from the fund to be loaned to farmers by CBN. 

According to him, if farmers have access to quality seeds, agricultural inputs like herbicide and fertiliser and apply good agricultural practices, there is assurance that such farmers would get double yield of cassava, maize and rice harvest. 

“Production cost will also be lowered, thereby, earning more income per hectare,” he said. 

The bank had disclosed that the job and food increase expected from the scheme would be achieved through zero-interest inputs financing options such as fertiliser, seeds, seedlings, pesticides and other farm inputs in the 36 states of the federation and the Federal Capital Territory. 

It would run for one year and about two million hectares of land would be cultivated. It will involve crop and animal production, and each farmer would cultivate one hectare. 

“The priority crops and livestock targeted by Agric for Food and Jobs Plan (AFJP) for local market are rice, maize, sorghum, groundnuts, cowpea, cassava, millet, livestock, palm kernel and cotton, while sesame seeds, hibiscus, cocoa, hides and skin; horns and hoofs are targeted for export market,’’ a statement from the apex bank said. 

The CBN Governor, Godwin Emefiele had said during a review session on the ABP, and the strategies for the 2020 agricultural wet season that the creation of a non-interest window was a result of appeals from stakeholders for farmers across the country to also be considered for funding under the non-interest facilities. 

“There is no more excuse for farmers and Muslims not to obtain credit facilities and engage themselves in more productive ventures. All the youth must be gainfully employed. Agriculture is our best option with clear focus on job creation, sustainable livelihood and rural development. 

“They should link up with the International Institute of Tropical Agriculture (IITA) for quality seeds, capacity building on good agricultural practices, and the use of modern production tools for increase productivity,” Prof. Sanni said. 

A former Regional Coordinator of the Bill and Melinda Gates Foundation-sponsored Cassava: Adding Value for Africa (CAVA), Professor Kolawole Adebayo, also expressed satisfaction about the zero-interest scheme, saying, “If implemented to achieve the stated objective, it will be great. The impact on the Nigerian food systems will be immense. I truly hope that all the ancillary requirements to ensure that farmers make the best use of the fund will also be concurrently addressed.” 

Uchegbu Chijioke Nicholas, Chairman, Poultry Association of Nigeria (PAN), Imo State Chapter who is also the National Public Relations Officer, Catfish and Allied Fish Farmers Association of Nigeria (CAFFAN) in his view, said this is a welcome development so far as it will target farmers in their areas of comparative advantage. Example of this is for government may be to look into geopolitical Agricultural advantaged products such as Poultry, fishery, cow, piggery, fruits and vegetables, maize, tomatoes, potatoes among others. 

“This should be driven by the commodity Associations in collaboration with Agricultural development programs of each state. Unless we strengthen these Associations no funding will reach the target farmers. 

Francis Nwilene, Regional Coordinator, Africa Rice Centre, IITA premises, Ibadan stated that the non-interest window facility of CBN will definitely help the smallholder farmers to boost agricultural productivity and the GDP of the country. The focus of the facility should be on the intended beneficiaries who are farmers in the rural communities. 

He advised that GPS should be used to map the farm location and size of the farmers and that the apex bank needs a simplified loan application format that can be easily completed such as business or cooperative registration and plan, BVN among others by the farmers. 

“It is well known that majority of the farmers have lost their seed stock or eaten all harvested grains during the Covid19 period. The interest-free agric loan is seen as a government incentive to support farmers to produce more to cope with the increasing demand for food due to restrictions on movement of people. On the other hand, the government can go into negotiations with the farmers to buy back the farm produce / grains and store in the strategic grain reserves for period of scarcity. 

“It will also be good if the loan can cover climate-smart agricultural technologies and mitigation measures,” he advised. 

It would be recalled that the apex bank and other stakeholders recently launched an initiative to mitigate the impact of COVID-19 on food production in the country increase production by about 10 million metric tonnes within a year. 

The joint venture, in partnership with the private sector through some out-growing schemes, involves farmers and off-takers to ensure value chain development of the crops, boost farmers’ income through access to improved inputs.

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