The Central Bank of Nigeria has identified attitude of commercial Banks to funding of Agriculture as a major impediment to the growth of the sector in Nigeria.
The Controller of CBN at Osogbo branch, Mr Ademola Atobatele made the observation in Osogbo, while declaring open a 5-Day Training on Agricultural Value Chains Upgrade Services For National, Regional and Global Competitiveness organized by The Nigeria Incentive-Based
Risk Sharing System for Agricultural Lending, NIRSAL.
Correspondent, Adenitan Akinola completes the story.
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The Central Bank of Nigeria, CBN has identified attitude of Commercial Banks to funding of Agriculture as a major impediment to the growth of the sector in Nigeria.
The Controller of the Osogbo branch of the CBN, Mr Ademola Atobatele made the observation in Osogbo, while declaring open a 5-Day Training on Agricultural Value Chains Upgrade Services For National, Regional and Global Competitiveness organized by the Nigeria Incentive -Based Risk Sharing System for Agricultural Lending, NIRSAL.
Mr Atobatele said to mitigate the risk in Agriculture lending which many Banks avoided, the Apex Bank established NIRSAL to bear 75% percent of the risks.
The CBN Controller added that apart from funding, poor capacity in commercial Agriculture had also impeded the progress of Agriculture value chain in Nigeria, hence the need to train the operators and the financial institutions in the value chain.
Mr Atobatele hinted that the CBN was committed to the growth of the nations Agriculture sector through its various interventions.
He explained that the commitment of the Apex bank was borne out of the reality that reliance on crude oil might not be sustainable to grow the economy, as Agriculture offered a more dependable alternative that could accommodate a large number of stakeholders.
In a remark, the Head of Project Monitoring, Reporting and Remediation Office (PMRO) NIRSAL, Mr Niyi Akande observed that Banks in Nigeria were doing far less than expected in Agric lending.
Mr Akande said this loaning measure was a CBN policy, which the commercial Banks had not been implementing for “obvious fear of the risks involved in Agric financing”.
The Osun NIRSAL boss stressed that NIRSAL was working towards ensuring that by year 2026, all Commercial Banks were committed to absolute implementation of the ten percent of their loan portfolios to Agriculture.
Mr Akande also called on Banks to establish and maintain a functional Agriculture desk that would analyse the level of their risk and make their facility accessible to farmers and service providers
In a comment, one of the operators in the Agriculture value chain in Osun State, Mr Ali Alabi explained that unless Banks were ready to give facility to farmers and service providers, the Agriculture sector would not be able to support the Nation’s economy as planned.
Mr Alabi also appealed to government to do more in providing physical security for farms, as many farmers had lost huge amount to animal invasion of their plantation, while others had given up on commercial farming for fear of incessant cattle invasion of their farms.