The Central Bank of Nigeria (CBN) disbursed N41.02 billion to farmers through Anchor Borrowers’ Programme (ABP) between September and October this year.
A report released by the apex bank disclosed that under the ABP the apex bank disbursed N41.02 billion to several agricultural projects, bringing the cumulative disbursement under the Programme to N1.06 trillion to over 4.6 million smallholder farmers cultivating 21 commodities across the country.
The bank also disbursed N0.30 billion to finance large-scale agricultural projects under the Commercial Agriculture Credit Scheme (CACS). Consequently, the total disbursement under the Scheme for agro-production and agro-processing stands at N745.31 billion for 680 projects.
“In addition, the Bank released the sum of N48.30 billion under the N1.0 trillion Real Sector Facility to seven new real sector projects in agriculture, manufacturing, and services. Cumulative disbursement under this Facility currently stands at N2.15 trillion to 437 projects across the country, comprising projects in manufacturing (240), agriculture (91), services (93) and mining sector (13). Furthermore, under the 100 for 100 Policy on Production and Productivity (PPP),” it said.
The bank also disbursed the sum of N20.78 billion to nine projects in healthcare, manufacturing, and services. The cumulative disbursement under the Facility therefore, amounted to N114.17 billion in 71 projects. Moreover, the Bank disbursed N4.00 billion under the Intervention Facility for the National Gas Expansion Programme (IFNGEP) to promote the adoption of compressed natural gas (CNG) for transportation and liquefied petroleum gas (LPG) for cooking.
In support of the resilience of the healthcare sector, the Bank also disbursed N5.02 billion to four (4) healthcare projects under the Healthcare Sector Intervention Facility (HSIF), bringing the cumulative disbursement to N135.56 billion for 135 projects in pharmaceuticals (33), hospitals (60) and other services (42).
Also, under the Micro, Small and Medium Enterprises (MSME) sector, the Bank provided support for entrepreneurship development with the disbursement of N1.33 billion and N10.00 million under the Agribusiness/Small and Medium Enterprise Investment Scheme (AgSMEIS) and Micro, Small, and Medium Enterprise Development Fund (MSMEDF), respectively. Hence, the total disbursement under these interventions amounted to N150.22 billion and N96.08 billion, respectively. Under the Export Facilitation Initiative (EFI), the Bank provided support for export-oriented projects to the tune of N5.34 billion, such that the cumulative disbursement under this intervention stands at N44.58 billion.
According to the ABP guidelines, loans granted to the farmers are repaid with the harvested produce that are mandatorily delivered to the anchor at designated collection center in line with the provisions of the agreement signed.
The produce to be delivered covers the loan principal and interest. The benefiting smallholder farmers are those engaged in the production of rice, maize, wheat, cotton, cassava, potatoes, yam, ginger, oil palm, cocoa, rubber tomatoes, fishes, poultry, among others.
Also, the input suppliers submit expression of interest letter to the office of the Project Management Team (PMT) for consideration and issuance of local purchase orders.
The Nigerian Agricultural Insurance Corporation (NAIC) provide insurance cover to the projects under the Programme, ensure timely processing and settlement of claims serve as member of the PMT.
According to CBN Governor, Godwin Emefiele, the ABP, launched in Birnin Kebbi, Kebbi state capital, in 2015 was meant to ensure easy loan access to farmers.
Under the ABP, farm inputs are provided in cash and kind to smallholder farmers (SHF), thus guaranteeing input supply to agro-processors.
During harvest, the farmer supplies produce to the agro-processors (anchors) who then pay the cash equivalent to the farmer. Rice, a major commodity under the ABP, is the third-most consumed staple food in Nigeria — after maize and cassava — and has become a food security crop due to its increased significance in the country.