Taking Stock of the FGN’s Commercial Agriculture Credit Scheme

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Thursday, November 22,
 2018 / 11:22 AM / United
Capital                     

The Central Bank
of Nigeria (CBN) recently released an evaluation and impact assessment report
on the Commercial Agriculture Credit Scheme (CACS) – a program that was
established by the Federal Government of Nigeria to support the Agricultural
sector through a special credit intervention fund of N200billion.

This funding was
made available to participating banks to finance commercial agricultural
enterprises at a maximum interest rate of 9%. This also includes a N1.0bn state
government loan availed to participating banks for on-lending to farmers’
cooperative societies and other areas of agricultural development which are in
line with the objectives of the Scheme (CACS).

Key findings from
the survey revealed that:

• Beneficiaries
of the CACS recorded a growth differential of 18.5% and 14.5% when compared
with growth in agriculture and manufacturing respectively.

• Beneficiaries
were able to upgrade their operational capacity.

• Business failures due to poor business plans, late
disbursement of funds, the shortfall in the planned budget, tedious bureaucracy
and bottlenecks of participating banks were some of the issues highlighted.

This report clearly underscores the CBN’s developmental roles in supporting the
real sector of the economy. We believe that in the long run – after the impact
lag associated with these kinds of interventions fully materializes, more
positives would be recorded in the Agriculture sector.

 

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