The board of directors of the Agricultural Credit Guarantee Fund (ACGSF) says the repayment of farmers’ loans under the scheme has been very impressive, noting that it has so far recovered more than 90% of the loans that it has guaranteed since its inception until May this year.
Chairman of the Board, Mr. Stephen Okon revealed this yesterday in Abuja, during the National Farmers Awards 2021 ceremony to reward participating farmers and financial institutions who have been consistent in repaying their loans and for their support of the program.
ACGSF was established in 1977 to underwrite agricultural credit facilities for farmers. The Federal Government and the Central Bank of Nigeria (CBN) both contribute 60% and 40% to the Fund respectively. The CBN does, however, act as the Scheme’s managing agent and secretariat.
Okon said that since its inception till May 2022, the scheme had guaranteed a total of 1,232,326 loans worth N130.903 billion, of which 973,646 beneficiaries had repaid a total of N98.91 billion.
He noted that the ACGSF program has proven to be relatively effective in reducing risks in the agricultural sector in Nigeria.
According to him, “The Agricultural Credit Guarantee Fund (ACGSF) Farmer of the Year award was introduced in the 1980s to reward selected farmers who borrowed under the scheme and repaid within a set period of time. while adopting the best agronomic practices to obtain good yields.
“This should serve as an incentive to participate in the program and instill good repayment behavior with a view to encouraging more program participants.”
He said to further encourage program participants, the Board last year approved increasing interest reimbursement for farmers and agricultural value chain participants from 40% to 50% to cushion the effect of the COVID – 19 pandemic. According to him, the increase took effect from January 1, 2022.
He said it was important to support farmers because achieving food security not only brings significant benefits to human health, but also serves as a foundation for achieving sustained economic growth.
Okon called on stakeholders, banks, state officials and other relevant agencies to continue supporting agricultural value chain participants through credit and advisory services to help them develop their full potential.
Earlier in his goodwill message, Branch Comptroller, CBN, Abuja Branch, Ogbu Onyeka Michael, while congratulating the winners, said it is evident that the successes achieved under the ACGSF have led to significant improvement in depository bank (DMB) lending to the agricultural sector and led to remarkable growth in the agribusiness value chain in Nigeria.
According to him, “the negative impact of the COVID-19 pandemic and, recently, the Russian-Ukrainian war on the global supply chain, has further underlined the importance that the CBN places on agriculture and d “other real sector interventions aimed at insulating the economy from these external shocks. This only leaves us wondering and imagining what the consequences on the country would have been without the CBN’s initiatives.”
He said the award is an expression of CBN management’s commitment to supporting hard work, innovation and productivity in the agricultural value chain.