By Tope Musowo
Lagos
Technical Adviser, All Farmers Association of Nigeria (AFAN), Dr. Tunde Arosanyin, yesterday, appealed to the federal government to adequately fund agricultural finance institutions.Arosanyin, who spoke to the News Agency of Nigeria (NAN) in Abuja, said this would enable farmers to have easier access to loans as well as make them play their roles more effectively.
He said agricultural finance institutions in the country like the Bank of Agriculture (BoA) had been under-capitalised for a long time, making it difficult for farmers to access their loan facilities.
He said: “The problem with the Bank of Agriculture is that it has not received any money from the Central Bank of Nigeria (CBN) in the last 10 years. CBN and the Federal Ministry of Finance are supposed to make some contributions to the bank in order to meet farmers’ credit demand.
“But I can confidently tell you that they have not received a dime from the federal government or the CBN. Three years ago, government set aside N200 billion for farmers, but we could not access the money because the CBN did not release it to BoA.”
Arosanyin said the administration of former President Olusegun Obasanjo also announced a huge sum of money to help farmers to increase productivity, but nothing was heard of it afterwards.
He stressed the need for the current government to address the issue in order to give impetus to its economic diversification agenda through agriculture.
Arosanyin decried the strict conditions attached to accessing loans from financial institutions and called for urgent review.
“For the BoA, interest rate has been on single digit and this is about nine per cent, which is relatively high for many farmers.
“Then for commercial banks, the interest rate is between 18 to 20 per cent and for a farmer to be able to access loans, you must open an account and run it for a period of six months.
“Commercial banks complained that most stakeholders have not deposited money in it and in some cases used depositors’ monies to loan out.”