The Bank of Agriculture would soon receive a N720 billion recapitalisation grant from the Federal Government before the end of the year. The Central Bank of Nigerian would provide the funding for restructuring and to enable the bank to attract N1trillion to provide loans at affordable interest rates to farmers.
Minister of State for Agriculture, Heineken Lokpobiri, made the disclosure in Abuja.
“The Central Bank of Nigeria is collaborating with the Ministry of Agriculture. This is because one of the biggest challenge of agriculture in Nigeria today is access to affordable loans. But in many other parts of the world, agriculture is the most attractive sector for banks to lend money to. So what do we do?
“As a ministry and the Federal Government, we are planning to recapitalise the Bank of Agriculture. So, we are to restructure the BoA and the CBN is committed to providing about N750bn. The BoA as an institution itself is going to attract hundreds of billions of naira. And we are thinking that before the end of next year, we should be able to attract at least N1tn available credit to be lent to anybody who wants to do farming business.
“Right now, the Federal Government is subsidising farmers, but the subsidy is not what the farmers want. We have seen this under the Anchor Borrowers Scheme of the CBN in Kebbi. In that scheme there was no subsidy.
“What the CBN, through the BoA, did was to give each farmer between N110,000 and N130,000 to cultivate one hectare of rice farm, and some of them got 10 tonnes per hectare. And if rice per tonne is between N60,000 and N80,000, then whoever adequately cultivates two hectares is already a millionaire,” he said.