The federal government has commenced the recapitalization of the Bank of Agriculture (BOA) with the sum of N65 billion and it is expected to rise to N250 billion.
This, the government says, is to support farmers towards value chain development for food security.
The sum of N5 billion has already been set aside as loan by the bank to support livestock farming.
The Minister of Agriculture and Rural Development, Dr. Mahmood Abubakar, while addressing journalists recently in Abuja, said the time has come to balance the agricultural sector with livestock.
He said the N5 billion for the livestock sector will be loaned to qualify farmers while the government will continue to recapitalize the bank to enable it perform its function to Nigeria farmers.
“When you talk about agriculture, most people just think about crops, well agriculture is everything, the crops, the livestock, fisheries, they are all part of agriculture. Of course the crop sector, have always gotten more attention most times, but while thinking of food security, you have to also think of nutrition security, you need other components that will complement the grains, or otherwise you will have a growth that looks healthy but not healthy,” he said.
Also speaking, BOA Managing Director, and Chief Executive Officer, Alwan Ali Hassan, noted that for long there has been more emphasis on the crops and poultry farmers than the livestock and small ruminant, hence the need to factor in the livestock farmers.
He however warned that loan will not be given to association but to individual farmers in the association,
“The livestock sector financing that we intend to start very soon has actually kick-started about 2-3 weeks ago and we have virtually registered close to 10,00-20,000 customers in our branches nationwide.
“The bank has 110 branches across the country and we advise the applicants to go to the nearest branch to register their names and obtain the application forms to complete the process, this is a loan, it is a capital from the bank, so let them pay back as when due, the bank has a credit policy ad a credit process, we will take them through heat process and the program.
“It is an ongoing process and the technical committee of the shareholders of the ministry of Finance and the Federal Ministry of Agriculture has set aside at the first instant, recapitalize the bank with N65 billion and going forward we are expecting the bank to have more recapitalization to maybe N250 billion.
“For the interest rate, depending on which of the value chains you are taking, our rates starts from 9% up till 15% depending on which of the value chain you taking, that means it depends on the risk factor of the business you are going into,” he said.
He added that the modality of giving out the loans is going to be exactly as it is enshrined in our loan conditions, which is governed by the Central Bank regulations and also regulated by the bank financial institute.
Hassan also stressed that the maximum of what can be given depends on what can be presented as collateral, “but if you don’t have a collateral and you are giving me a guarantee, there is an amount you can collect, so you need to understand it is a loan and you must get a cover to get the money.
