Agric funding: stakeholders lament banks’ role

The agricultural stakeholders that participated at the recently held 2nd strategic planning meeting of the Forum for Micro, Small and Medium Enterprises Business Membership Organization of Nigeria (MSME-BMOs) have lamented over commercial banks’ high-interest rate on loans with demand for a throat-cutting collaterals. .

This and other issues were major discussions at the business forum convened for the purpose of establishing a vocal voice on economic matters for small and medium scale entrepreneurs in Nigeria held at Raw Material Research Development Council (RMRDC), Aguiyi Ironsi, Maitama, Abuja.

The National Apple Farmers, Processors and Marketers Association of Nigeria (NAFPMAN), Mr. Clement Omoyeni Ohikhueme queried the process of loan issuance by the commercial banks in the country to farmers, saying food producers are being asked to bring collateral from high brow areas of Abuja and other cities before they could be given any loan even when their farms can be used as surety. .

He said ‘’ loan is issued to farmers with demand for collateral even as your farm cannot stand for you before the commercial banks. All they need are buildings and skyscrapers in Abuja as they believe that is the only way to secure their money and which is the wrong perception’’  

The National Producers Processors and Marketers Association of Palm Oil, president, Mr.  Alphonsus Inyang also described the demand of collateral from farmers as a bad way of running agric business in the country saying that ‘‘until we solve the issue of collateral and building of business plan before we get it right in this country’’

Inyang  urged the Central Bank of Nigeria (CBN) to emulate the Bank of Ethiopia where only  15% equity is demanded getting a loan for at least 15-20years without any collateral being asked for.

Mr.  Eze Ignatius the representative of the Mushroom Association also suggested that in other to do away with the issue of collateral the forum should look into the option of the ESUSU money contribution, saying that the system has helped to fund lots of projects in the past and could still be adopted by the forum.

During his address, the Chairman Board of Trustees, MSME Forum Dr. Albert Olajide Akinyemi stressed the need for SME sector to catch on to the opportunity in agriculture as being done by China who is now growing yam, cassava, and cocoa for the purpose of export to Europe and America, pointed the need for the establishment of MSME bank for the BMOs so as to checkmate the complaint of collaterals of the commercial banks.

Adeyemi added that it was key for the SMEs to come together as one body to find the best way forward for the MSME operators in Nigeria pointed government alone should not be saddled with the responsibility of private sector’s development, but rather the SME operators   should have a greater bit of the responsibility.