Review of 40-year-old agric funding scheme underway

The Federal Government, through the Central Bank of Nigeria (CBN), is seeking an upward review of agricultural lending to farmers by Deposit Money Banks (DMBs) under the Agricultural Credit Guarantee Scheme Fund (ACGSF), Daily Trust has learnt.

This is one of the considerations of the ACGSF 2018 Board Strategy Retreat which held in Lagos with theme, ‘ACGSF: Repositioning for Impact’.

The scheme, established in 1977 through an Act of Parliament, was a response to the clamour for sustainable financing for farmers and agropreneurs to boost food security in the country.

Though through its 40 years since establishment, the scheme has been providing guarantee cover for farmers to access loan from commercial banks, the contextual issues in the scheme, especially the loan ceiling, have remained the same since inception.

Daily Trust learnt that for instance, according to the provisions of the scheme, an individual farmer can only access a maximum of N100,000 from DMBs; the amount is considered too low due to the skyrocketing costs of goods and services.

These issues would form part of the deliberation of the retreat being attended by different stakeholders, including farmers, Bankers’ Committee representative, cooperative groups, among others.

Chairman of the ACGSF Board, Mrs. Olubunmi Siyanbola, confirmed that the maximum loan guaranteed for individuals, corporate bodies and cooperative societies, has since lost value due to the rising costs of goods and services coupled with the dynamics of the macroeconomic situation of the economy.

She also noted that the nonexistence of the board for 12 years affected the smooth functioning of the scheme.

It could be recalled that the scheme operated without a board since 2007 until 2018 when it was reconstituted.

Siyanbola said despite the challenges encountered by the scheme, it has helped in some ways to tackle the scourge of financial access among agropreneurs in the country.

According to her, the retreat was an “important opportunity to come up with innovative ideas to reposition ACGSF as a pedestal for agricultural development in Nigeria.”

“In my opinion, we all have a crucial role to play, here, by coming up with deliberate initiatives of X-raying the fund by evaluating the limitations and the learning points over the years as well as coming up with practical solutions for increasing bank’s participation under the ACGSF within the next couple of years,” she added.