Nigeria has made progress in strengthening regulations to enhance financial inclusion especially in the agriculture sector.
One of these financial inclusion is the Anchor Borrowers Program (ABP) which was launched by President Muhammadu Buhari on November 17, 2015 to create a linkage between anchor companies involved in the processing and small holder farmers of the required key agricultural commodities.
The programme being implemented across the country by the Central Bank of Nigeria (CBN), with support from the Bank of Agriculture (BOA) and the Ministry of Agriculture and Rural Development, has received high commendation from stakeholders in the agricultural sector, as it targets farmers directly while disturbing agricultural credit facilities.
Nigerian agriculture, especially rice production witnessed boost because farmers went back to farms upon hearing the benefits of the programme.
Recently, farmers complained about some anomalies in the Program which they said may jeopardise the entire Program if necessary steps weren’t taken.
It would be recalled that the Chairman of the Senate Committee on Agriculture, Senator Abdullahi Adamu restated the need for the CBN to hand over the administration of the ABP and other agricultural programmes.
He said the agency of government that has the mandate for the promotion of agricultural production generally is domiciled in the Ministry of Agriculture while the Bank of Agriculture (BOA) should handle loans to farmers.
“BOA is supposed to be the agency through which financing of agricultural loans and other facilities to empower farmers of various categories to benefit and get necessary funding be domiciled.
While farmers in some states had complained about delay in payment of the ABP fund from the Central Bank of Nigeria (CBN), they also lamented that they were unable to harvest their crops due to lack of funding from the Anchor Borrowers Program.
In some areas, some farmers lamented that the seeds supplied to them for the planting season under the Program was fake.
When the ABP was launched in 2015, one of the aim was to increase yield per hectare in rice production, in order to meet up with the deficit in the nation’s annual rice production.
Meanwhile, the yield per hectare in some states exceeded five metric tons which in turn increased Nigeria’s annual rice production to over five million metric tons.
After observing some of the shortcomings of the Program, some stakeholders and farmers suggested that ABP should be domiciled in the Bank of Agriculture.
The stakeholders were of the opinion that the BOA is more closer to the farmers than the CBN, with majority of its offices are in the rural areas.
The Ministry of Agriculture and Rural Development which oversees the BOA has a more comprehensive list of farmers in Nigeria which may make easier for the BOA to reach them directly.
The stakeholders, however, said if the anomalies raised by the farmers were not addressed urgently, the aim of initiating the ABP may be defeated.
They however called on the appropriate authorities to recapitalise the BOA as it is better positioned to carry out agricultural programmes rather than letting CBN carry out the mandate.
Speaking on the challenges, a stakeholder in the agric sector, Magaji Abdullahi while noting that the scheme has been facing several challenges in states, noted that the biggest challenge was the delay in funds disbursement.
Abdullahi who said money was given very late from the beginning of the scheme, added that the last tranche of the money for 2019 farming season is yet to be paid as well.
He said farmers can’t make repayment, while that the scheme was facing several challenges in the state.
The Bank of Agriculture is better placed like the Bank of Industry (BOI) as development banks to take responsibility in administering money from government that is aimed at promoting agricultural production in the country.
Furthermore, an expert, Dr Shehu Babayo lamented that those in charge of Anchor Borrower in some states couldn’t get their farmers to repay due to the delay in funding from the apex bank.
“There were given these loans with huge collateral, yet they are finding it difficult access the fund.
Need to reposition agric sector
On efforts to reposition the agricultural sector, an expert Dr Alli Amodu while commending Nigerian farmers for their efforts at ensuring food security in the country despite the challenges they were facing called on the senate to initiate bills that would impact the sector positively.
Dr Amodu also lamented that the Nigeria Agricultural Insurance Corporation (NAIC) insurance does not cover all risks associated with farming and this confusion on what is covered is a discouragement.
He advocated that the government should continue to provide smart premium subsidies for farmers to enable them have access to agricultural insurance which is intended to protect their entire investments and ensure food security in the long run.
He further said efforts should be made at recapitalising the BOA to be better positioned to carry out its mandate.
“I believe that it is not within the mandate of the Central Bank of Nigeria as the apex and monitoring bank to get involved with loan facilities because they are the referee in financial sector.
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