In the last five years, agriculture funding
by Nigerian banks has more than doubled. Several banks are presently lending to
their customers involved in agriculture under several schemes under the
auspices of the Central Bank of Nigeria (CBN). These loans are for new
investments and expansion of commercial agricultural enterprises.
In 2010, Diamond Bank made “a measured” entry
into financing the agriculture sector by engaging an international consulting
firm to assess the risks and opportunities across all agricultural value chains
of crops and livestock of economic importance in Nigeria. The outcome formed
the basis for setting up the bank’s agrifinance desk ahead of the CBN’s
directive to all commercial banks to set up specialized desks focused on
lending to agriculture.
Diamond Bank adopts a commercial approach to
lending to agribusinesses focusing on gaining market share that follows the
main investment trends; non-oil exports, import substitution, agro-processing,
retailing and engaging in partnerships with catalyst agencies to develop
markets and specific value chain financing products.
Consequently, the bank has provided improved
access to finance through key considerations into its pricing, products, underwriting
processes and marketing strategies with more than N100 billion disbursed to
over 400 agribusinesses across the various nodes of the agricultural value
chain in the last five years.
Head, AgricFinance, Diamond Bank, Lois
Sankey, stated that the bank is very passionate about growing and driving
financial inclusion through proven agricultural value chain financing models
especially in the rural areas.
“The programme we are currently working on,
the Rice Anchor Borrower Programme has direct impact on financial inclusion and
rural financing and we have N2.5 billion as portfolio exposure appetite to this
programme alone. That is a lot of commitment considering that the cost of
production per hectare is a mere N178, 000” Sankey stated.
According to her, Diamond Bank is leveraging
its partnership with USAIDMARKETS2 and other agencies on the project to support
and Improve capacity and livelihoods of small holder rice farmers in target
states across Nigeria.
Agric finance milestones
Some of the major milestones in Agrifinancing
at Diamond Bank includes signing of $33 million Agrifinance, two years Agric
Technical Assistance programme with International Finance Corporation (IFC),
targeting 2000 small holder farmers and $33 million small holder loans;
training of 60 key members of staff along the agriculture value chain within
the bank in partnership with USAIDMARKETS II Programme, engagement with Africa
Cocoa Inputs Finance pilot with Technoserve. More than N5 billion has been disbursed
to 15 projects under CBN’s Commercial Agriculture Credit Scheme, active
participation in other previous and on-going CBN and Federal Government
intervention programmes and working to support about 750
small holder rice farmers in Benue state under the Rice Anchor Borrower
Scheme with MIKAP Ltd.
Focus on women farmers
According to the Food and Agriculture
Organisation (FAO), women make up to 43 per cent of the agricultural labour
force in developing countries. Research shows that on the average, their yield
are about 20 percent to 30 percent lower than men because they have less access
to land, improved seeds, equipment and most importantly finance and
information.
Diamond Bank in a strategic move is focusing
on female farmers by providing free technical training and financial grants to
rural women involved in agriculture. The initiative which is called Beta Life
for Female Farmers is aimed at empowering female farmers across the 36 states
of the country and reducing poverty level.
Chief spokesperson, Diamond Bank, Ayona
Trimnell, stated that the bank’s strategic move to help female farmers in the
rural areas improve their crop yields and farming method is rooted on the fact
that increased farm yield by women can significantly help in reducing the
current food gap.
“Women form a large pool of farmers in the
country today and they contribute significantly in the food production basket.
But they are hardly considered when measures for increased yields are being
introduced by either the government or other investors. We believe that if
women farmers are fortified with the necessary knowledge on how to improve
their yields and have access to funds, they will do well and the food import
bill will reduce significantly,” Ayona stated.
According to her, the primary aim of the
Diamond Bank female farmers’ project is to help engender improved quality of
life for women farmers in Nigeria through business funding, education and
technical support on agronomic practices and training on financial management.
This intervention forms part of the bank’s
Women’s Wealth and Well-being Initiative which has three main objectives
including empowering women economically especially in the area of agric
business, providing basic health care education and services to women in rural
areas, leading to improved productivity, growth and value addition of women in
the cassava value chain.
The first phase of the project which
commenced in 2014 involved training 200 women in Oyo and Ogun states on best
agronomic practices. Other areas of the training and capacity building
programme involves, access to credit-either for production or processing and
financial advisory services, agricultural extension and research services;
technical assistance on processing and access to markets and assisting the
groups in inculcating a savings culture through the opening of BETA Savings for
the targeted groups and group members.
The project also aims at developing capacity
and strengthening farmer organisations through the provision of improved inputs
and mechanised farm equipment by the bank. These innovative processes is
projected to enhance productivity, increase efficiency, improve the processes
and entrench practical benefits for the selected women producers and their
agri-businesses.
The initiative will also facilitate access to
information on best agronomy practices and access to markets through
international organisations and research and development Institutions; open
access to credit and sustainable financial management practices. Currently 200
women in cassava production and processing in Oyo and Ogun states have
benefitted from the programme, which is still on-going with plans to replicate
same model across the country in the next three years.
Women farmer groups
In its resolved bid to strengthen and improve
the living standards of women farmers in rural areas in Nigeria, Diamond Bank
as part of its CSR initiative trained and equipped the following farmer groups
in Ondo and Oyo states.
The farmer groups in Ondo include Agbajowo
CMC Processing Group, located in Shagari village, Akure; Agbeloba Cassava
Processing Group, Ile-Oluji Farm settlement; AduraAgbeagba Cassava Processing
Group, Ile-Oluji.
Others in Ondo State include Oluwapawopa
Cassava Processing Group, Owo; Okonilewo Cassava FUG Cooperative Society, in
Igba.
In Oyo State, the farmer groups include,
Onipepeye Cassava Processors Group, Ikulodi; AlaseGari Processing Group,
Iseyin; Agbeloba Cassava Farmers Groups, Iganna; Agbelere Cassava Farmers
Group, Fiditi and GarriGbayi Cassava Processing Group, Iseyin.
With Federal Government’s resolve to
diversify the economy, strengthen agriculture and increase its contribution to
the GDP, it is obvious that Diamond Bank’s CSR initiative and partnership with
female farmers will impact positively on local food production and attract many
unemployed youth into farming, thereby reducing the high unemployment level in
the country; and bridging the food supply gap.
Undoubtedly, Nigeria is endowed with abundant
natural resources such as solid minerals, oil and gas as well as arable land
for agriculture, among others. And, despite being the seventh most populous
country in the world with abundant youth workforce, reports show rising youth
unemployment and only about 40 percent of Nigeria’s arable land is being
cultivated, thus leading to food supply deficit and huge food import bill.
But agricultural development in the country
has remained sluggish and agrarian, with farmers using crude implements and
women being mostly hit with low farm yield, inability to access funds from
financial institutions, limited access to land and lacking the requisite
knowledge on how to improve yields in their farms.
http://thenationonlineng.net/diamond-bank-takes-lead-agro-lending-women-farmers/
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