Post by Trade facilitator on Apr 11, 2023 20:20:25 GMT 1
Anchor Borrowers’ Programme (ABP): CBN Counters IMF, Says 52% Of Loans Repaid And Why Defaulters Are Not Repaying Loans
The Central Bank of Nigeria (CBN) counters IMF and says that N503 billion of loans under its Anchor Borrowers’ Programme (ABP) have been repaid.
“Accordingly, the CBN continues to welcome applications from eligible Nigerian farmers and firms under the ABP.”
Last year, the apex bank said it would deploy the Global Standing Instruction (GSI) against loan defaulters under the ABP to ensure repayments.
According to the CBN this figure represents 52.39 percent of the total loans collected by farmers under the programme.
Last week, The Cable reported that the International Monetary Fund (IMF) said only 24 percent of loans collected by farmers under the ABP have been repaid — implying that 76 percent of the loans were yet to be paid.
In a statement recently, AbdulMumin Isa, CBN’s acting director of Corporate Communications Department, said about 48 percent of the loan has not been repaid.
Isa said the CBN has released N1.079 trillion under the programme, out of which N960 billion is due for repayment.
He also said the apex bank remains committed to its developmental mandate of stimulating access to finance for the real sector, adding that the ABP has supported about 4.57 million smallholder farmers who cultivated over 6.02 million hectares of 21 commodities across the country.
Some of the commodities, according to Isa, include rice, wheat, cowpea, millet, maize, cotton, fish, soya bean, poultry, cassava, groundnut, ginger, sorghum, oil palm, cocoa, sesame, tomato, castor seed, yellow pepper, onions, and cattle/dairy.
The ABP had contributed significantly to the increased national output of focal commodities, with maize and rice peaking at 12.2 and 9.0 million metric tonnes in 2021 and 2022 respectively,” he said.
“The programme had also helped to improve the national average yield per hectare of the commodities, with productivity per hectare almost doubling within the eight years of the programme’s implementation.”
Isa also said repayments under the ABP have been made through cash or produce by the beneficiaries.
He noted that the outstanding due balance on loans was still under moratorium owing to the COVID-19 forbearance granted to beneficiaries of the apex bank’s interventions in March 2020 and extended to February 28, 2022.
“It is pertinent to note that the tenure of loans under the ABP is based on the commodity gestation period,” Isa said.
“For instance, loans granted to farmers cultivating some perennial crops could have up to seven-year tenure.”
The CBN acting director said the bank’s interventions, with the core objective of catalyzing the economy’s productive base, have continued to support investments in capital assets in sectors with high-growth and employment-elastic potential.
“The CBN remains committed to its developmental mandate of stimulating access to finance for the real sector, particularly agriculture, as it continues to support the federal government’s drive for food security and economic growth,” he added.
“Accordingly, the CBN continues to welcome applications from eligible Nigerian farmers and firms under the ABP.”
Last year, the apex bank said it would deploy the Global Standing Instruction (GSI) against loan defaulters under the ABP to ensure repayments.
Why Are Beneficiaries Not Repaying Loans?
Default payments have continued to trail the Anchor Borrowers Programme (ABP) of the Central Bank of Nigeria (CBN), as over 50 percent loan remained unpaid seven years after.
This programme, launched in 2015, the ABP scheme was meant to provide farmers with the critical funds and inputs needed to increase local production.
According to the International Monetary Fund (IMF), 76 percent of the loans collected by beneficiaries were yet to be repaid. But the CBN has countered the claim saying that only 48% of the loans remained unpaid.
Speaking with BusinessDay, the heads of various farmer associations were suggesting that the loans were not disbursed adequately, hence the difficulty in ensuring repayment.
Yunusa Yabwa, the national secretary of All Farmers Association of Nigeria (AFAN), said that the programme was abused, adding that it did not meet expectations to boost food production.
He alleged that most beneficiaries of the programme were not farmers. “Many people collected the loan to invest in other projects not related to farming, and that is why it is difficult to ensure repayment.
“The anchor borrower is a laudable programme but there are challenges of recovery. Some of our members benefited from it, but most people that benefited are not farmers.
“One thing we know is that only few farmers benefited from the programme and it’s not supposed to be.
”CBN and NIRSAL that disbursed it are unable to recover the loans because they cannot trace the debtors, which unfortunately are not farmers. Many collected the loans in the name of farmers. The banks were only focused on disbursing the funds, so they were not bothered about who got the funds and that’s why recovery has now become difficult”.
It is currently difficult to know who is saying the truth between IMF and the CBN; but time will tell.
Addendum:
Our company is one of the best companies in the Agro-Export business in Nigeria today. We train individuals and corporate organizations on how to do Export Business the right way; if you are interested, please contact the admin of this forum now for further details.
The Central Bank of Nigeria (CBN) counters IMF and says that N503 billion of loans under its Anchor Borrowers’ Programme (ABP) have been repaid.
“Accordingly, the CBN continues to welcome applications from eligible Nigerian farmers and firms under the ABP.”
Last year, the apex bank said it would deploy the Global Standing Instruction (GSI) against loan defaulters under the ABP to ensure repayments.
According to the CBN this figure represents 52.39 percent of the total loans collected by farmers under the programme.
Last week, The Cable reported that the International Monetary Fund (IMF) said only 24 percent of loans collected by farmers under the ABP have been repaid — implying that 76 percent of the loans were yet to be paid.
In a statement recently, AbdulMumin Isa, CBN’s acting director of Corporate Communications Department, said about 48 percent of the loan has not been repaid.
Isa said the CBN has released N1.079 trillion under the programme, out of which N960 billion is due for repayment.
He also said the apex bank remains committed to its developmental mandate of stimulating access to finance for the real sector, adding that the ABP has supported about 4.57 million smallholder farmers who cultivated over 6.02 million hectares of 21 commodities across the country.
Some of the commodities, according to Isa, include rice, wheat, cowpea, millet, maize, cotton, fish, soya bean, poultry, cassava, groundnut, ginger, sorghum, oil palm, cocoa, sesame, tomato, castor seed, yellow pepper, onions, and cattle/dairy.
The ABP had contributed significantly to the increased national output of focal commodities, with maize and rice peaking at 12.2 and 9.0 million metric tonnes in 2021 and 2022 respectively,” he said.
“The programme had also helped to improve the national average yield per hectare of the commodities, with productivity per hectare almost doubling within the eight years of the programme’s implementation.”
Isa also said repayments under the ABP have been made through cash or produce by the beneficiaries.
He noted that the outstanding due balance on loans was still under moratorium owing to the COVID-19 forbearance granted to beneficiaries of the apex bank’s interventions in March 2020 and extended to February 28, 2022.
“It is pertinent to note that the tenure of loans under the ABP is based on the commodity gestation period,” Isa said.
“For instance, loans granted to farmers cultivating some perennial crops could have up to seven-year tenure.”
The CBN acting director said the bank’s interventions, with the core objective of catalyzing the economy’s productive base, have continued to support investments in capital assets in sectors with high-growth and employment-elastic potential.
“The CBN remains committed to its developmental mandate of stimulating access to finance for the real sector, particularly agriculture, as it continues to support the federal government’s drive for food security and economic growth,” he added.
“Accordingly, the CBN continues to welcome applications from eligible Nigerian farmers and firms under the ABP.”
Last year, the apex bank said it would deploy the Global Standing Instruction (GSI) against loan defaulters under the ABP to ensure repayments.
Why Are Beneficiaries Not Repaying Loans?
Default payments have continued to trail the Anchor Borrowers Programme (ABP) of the Central Bank of Nigeria (CBN), as over 50 percent loan remained unpaid seven years after.
This programme, launched in 2015, the ABP scheme was meant to provide farmers with the critical funds and inputs needed to increase local production.
According to the International Monetary Fund (IMF), 76 percent of the loans collected by beneficiaries were yet to be repaid. But the CBN has countered the claim saying that only 48% of the loans remained unpaid.
Speaking with BusinessDay, the heads of various farmer associations were suggesting that the loans were not disbursed adequately, hence the difficulty in ensuring repayment.
Yunusa Yabwa, the national secretary of All Farmers Association of Nigeria (AFAN), said that the programme was abused, adding that it did not meet expectations to boost food production.
He alleged that most beneficiaries of the programme were not farmers. “Many people collected the loan to invest in other projects not related to farming, and that is why it is difficult to ensure repayment.
“The anchor borrower is a laudable programme but there are challenges of recovery. Some of our members benefited from it, but most people that benefited are not farmers.
“One thing we know is that only few farmers benefited from the programme and it’s not supposed to be.
”CBN and NIRSAL that disbursed it are unable to recover the loans because they cannot trace the debtors, which unfortunately are not farmers. Many collected the loans in the name of farmers. The banks were only focused on disbursing the funds, so they were not bothered about who got the funds and that’s why recovery has now become difficult”.
It is currently difficult to know who is saying the truth between IMF and the CBN; but time will tell.
Addendum:
Our company is one of the best companies in the Agro-Export business in Nigeria today. We train individuals and corporate organizations on how to do Export Business the right way; if you are interested, please contact the admin of this forum now for further details.
