Post by Trade Coach on Dec 17, 2021 4:48:19 GMT 1
Farmers’ Finance Woes Are Over As CBN Moves Agricultural Loans Closer To Applicants – Opens Development Finance Offices In All Branches
The CBN warned that diversion of the agriculture loans will attract a five-year jail term. The loans must be used for the purposes for which they are obtained. Also, all loans under the scheme must be insured as a condition precedent to guarantee.
The Agricultural Credit Guarantee Scheme Fund (ACGSF) provides insurance guarantee cover (up to 75% of any outstanding balance upon default) in respect of loans granted the agricultural sector by banks, and also has a farmer-friendly scheme called “Interest Drawback Program” (IDP) of up to 40% interest refund upon liquidation of the facility.
In order to bring the administration of the Agricultural Credit Guarantee Scheme Fund (ACGSF) closer to farmers in the country, the Central Bank of Nigeria (CBN) has opened Development Finance Offices in all its branches across the nation.
The apex bank disclosed this as part of the new guidelines of the scheme recently. He said “Apart from the Head Office of the Central Bank of Nigeria, Development Finance Offices have been established in all branches of the Central Bank to administer the Agricultural Credit Guarantee Scheme. The Development Finance Offices are manned by officers who function under the overall control of the branch controllers of the Central Bank in each branch.
“In order to ensure that matters connected with the scheme are dealt with expeditiously, the officers will treat such matters in the state in which they are located unless banks are otherwise directed.”
According to the new guidelines, “Banks should remind prospective borrowers under the scheme that it is an offence for which one may be imprisoned for five years to apply the loan for purposes other than those for which they are given.”
A single obligor limit for Non-tangible collateral is fixed at N100, 000. But “While the obligor limit for individual, group/co-operative society is N50, 000, 000 (Fifty Million naira only) for secured loans.”
The Agricultural Credit Guarantee Scheme Fund was established by the Federal Military Government under the Agricultural Credit Guarantee Scheme Fund Decree 1977 (Decree No. 20) and as amended on 13th June 1988, and 26th June 2019.
What really is the purpose of the fund in the agricultural scheme of things in the country?
Why you as a farmer in Nigeria should pay attention to what the Central Bank is saying about the fund?
Let us look at and understand what the fund is about. The purpose of the fund is to guarantee loans made by lending banks to individuals and cooperatives that are into farming in the country. This is basically to boost credit to the agricultural sector.
The major reason for this is that in the past most major lending banks have been skeptical about lending to agricultural companies and businesses for fear of losing their funds.
Under the modified law, the term “loan” covers advances, overdrafts, and other credit facility.
The Act that established the fund originally provided for a Fund of N100 million subscribed to by the Federal Military Government (60%) and the Central Bank of Nigeria (40%). The share capital of the fund has of course since been increased to N50 billion while the paid-up capital in now N3.0 billion.
Who are the managers of the scheme?
The fund is being managed by the Agricultural Credit Guarantee Scheme Fund Board; the Central Bank of Nigeria is the Managing Agent for the Administration of the Scheme. The work relating to the scheme is handled by the Development Finance Department of the CBN headed by the Director.
Eligible participating financial institutions under the scheme
Deposit Money Banks
Microfinance banks under the regulatory and supervisory role of the Central Bank of Nigeria (CBN).
We of this forum believe that the Federal Government of Nigeria is doing all in its power to empower farmers and all in the agro sector; everybody concerned is therefore required to please play your part well in order to actualize the Government’s intention.
Our company a foremost agro-export company in Nigeria is seriously preparing for the coming cashew season starting in January 2022; and therefore in a serious business relationship with big time currently buying cashew companies; if you are an exporter or an intending exporter and you are interested in exporting cashew from Nigeria, call the admin immediately for your slot of the contract.
The CBN warned that diversion of the agriculture loans will attract a five-year jail term. The loans must be used for the purposes for which they are obtained. Also, all loans under the scheme must be insured as a condition precedent to guarantee.
The Agricultural Credit Guarantee Scheme Fund (ACGSF) provides insurance guarantee cover (up to 75% of any outstanding balance upon default) in respect of loans granted the agricultural sector by banks, and also has a farmer-friendly scheme called “Interest Drawback Program” (IDP) of up to 40% interest refund upon liquidation of the facility.
In order to bring the administration of the Agricultural Credit Guarantee Scheme Fund (ACGSF) closer to farmers in the country, the Central Bank of Nigeria (CBN) has opened Development Finance Offices in all its branches across the nation.
The apex bank disclosed this as part of the new guidelines of the scheme recently. He said “Apart from the Head Office of the Central Bank of Nigeria, Development Finance Offices have been established in all branches of the Central Bank to administer the Agricultural Credit Guarantee Scheme. The Development Finance Offices are manned by officers who function under the overall control of the branch controllers of the Central Bank in each branch.
“In order to ensure that matters connected with the scheme are dealt with expeditiously, the officers will treat such matters in the state in which they are located unless banks are otherwise directed.”
According to the new guidelines, “Banks should remind prospective borrowers under the scheme that it is an offence for which one may be imprisoned for five years to apply the loan for purposes other than those for which they are given.”
A single obligor limit for Non-tangible collateral is fixed at N100, 000. But “While the obligor limit for individual, group/co-operative society is N50, 000, 000 (Fifty Million naira only) for secured loans.”
The Agricultural Credit Guarantee Scheme Fund was established by the Federal Military Government under the Agricultural Credit Guarantee Scheme Fund Decree 1977 (Decree No. 20) and as amended on 13th June 1988, and 26th June 2019.
What really is the purpose of the fund in the agricultural scheme of things in the country?
Why you as a farmer in Nigeria should pay attention to what the Central Bank is saying about the fund?
Let us look at and understand what the fund is about. The purpose of the fund is to guarantee loans made by lending banks to individuals and cooperatives that are into farming in the country. This is basically to boost credit to the agricultural sector.
The major reason for this is that in the past most major lending banks have been skeptical about lending to agricultural companies and businesses for fear of losing their funds.
Under the modified law, the term “loan” covers advances, overdrafts, and other credit facility.
The Act that established the fund originally provided for a Fund of N100 million subscribed to by the Federal Military Government (60%) and the Central Bank of Nigeria (40%). The share capital of the fund has of course since been increased to N50 billion while the paid-up capital in now N3.0 billion.
Who are the managers of the scheme?
The fund is being managed by the Agricultural Credit Guarantee Scheme Fund Board; the Central Bank of Nigeria is the Managing Agent for the Administration of the Scheme. The work relating to the scheme is handled by the Development Finance Department of the CBN headed by the Director.
Eligible participating financial institutions under the scheme
Deposit Money Banks
Microfinance banks under the regulatory and supervisory role of the Central Bank of Nigeria (CBN).
We of this forum believe that the Federal Government of Nigeria is doing all in its power to empower farmers and all in the agro sector; everybody concerned is therefore required to please play your part well in order to actualize the Government’s intention.
Our company a foremost agro-export company in Nigeria is seriously preparing for the coming cashew season starting in January 2022; and therefore in a serious business relationship with big time currently buying cashew companies; if you are an exporter or an intending exporter and you are interested in exporting cashew from Nigeria, call the admin immediately for your slot of the contract.