Managing Director and Chief Executive of the bank, Prof. Danbala Danju said the Federal Ministry of Agriculture and rural development, in collaboration with the bank, was considering the review, as well as other incentives to ensure massive investments in agriculture.
At an international conference on agriculture with the theme, Danju said: “Back to Agriculture”, held in Lagos, said the minister of agriculture was thinking in that line, as “a situation where farmers in other countries are been offered between two to four per cent where we are charging 14 per cent, taking into consideration administrative charges among other charges, is not conducive for investments in agriculture.”
Presenting a paper titled: “Financing agriculture for economic growth in Nigeria”, he revealed that the bank is already piloting an initiative of the CBN.“The Central Bank has set aside about N200 billion. We will get the fund from the CBN and finance the input of farmers.”
He said about 75,000 farmers have benefited from loans from the BOA in the last three months and the targets is now about three hundred thousand farmers for the wet season, with the hoping of increasing the number as operations are been scaled-up in various parts of the country.
“The aquaculture loan is targeted at key crops like, rice, wheat and tomatoes borrowed from CBN at two per cent and lend it to farmers at nine per cent with a payment period of one year and we are thinking of developing payment structure that would be based on production cycle. Up till now, farmers consider funds from bank of agriculture as part of national cake. We have for instance about N20 Billion of defaulters, we been advertising for people to come and pay back,” he said.
“The bank of agriculture like every other Banks could only survive if windows credits are paid back. Non-payment is why we are introducing other mechanism first to identify farmers. Those who came to us in the past were non-farmers. We are now introducing bank verification numbers. We are taking steps to see for instance, if you say you have one or two hectares of lands, we have to verify buying GPS approach system to know the exact location amongst other measures.”
According to him, the bank is exploring the concept of land bank, which has been tried particularly in China and other countries with much success.
