The Central Bank of Nigeria (CBN) disbursed N15 billion to farmers in the 12 months ending November 2019 under its Commercial Agriculture Credit Scheme (CACS).
This however represents 77 percent decline when compared to the N66 billion disbursed to farmers under the scheme in the preceding 12 months ending November 2018. Similarly, the number of new agricultural projects that received funding under the scheme dropped by 56 percent to 20 in the 12 months ending November 2019 from 46 in the preceding 12 months period. Introduced in 2009, the scheme was designed to fast-track the development of the agricultural sector of the Nigerian economy by providing credit facilities to large-scale commercial farmers at a single digit interest rate.
The scheme is financed through a N200billion bond raised by the Debt Management Office (DMO). Loans to eligible entities under the scheme are disbursed at a maximum interest of nine percent. Analysis of the monthly economic reports of the CBN showed that, the amount disbursed to farmers since inception of the scheme rose to N611.5 billion as at November 2019, from N596.44 billion as at November 2018.
This implies that N15.06 billion was disbursed to farmers during the 12 months period ending November 2019. Also the number of projects financed under the scheme rose to 596 as at November 2019 from 576 as at November 2018, indicating that 20 new projects were financed during the 12 months ending November 2019. Meanwhile, farmers have so far repaid N384.41 billion of the loans received under the scheme as at November 2019.
According to the CBN Economic report for November, “In November 2019, the sum of N1.07 billion was disbursed to three (3) projects under the Commercial Agriculture Credit Scheme (CACS). Thus, the total sum released to the economy, under the Scheme from inception in 2009 to date, stood at N611.50 billion, in respect of 596 projects. In November 2019, sixty-two (62) projects repaid the sum of N8.15 billion, of which payment by fifty-nine (59) projects were steady repayments, while three (3) projects were full repayments.
Nigeria earns N5trn from oil in 11 months, as FG records N1.7trn deficit The repayments brought the cumulative repayment under CACS from inception in 2009 to N384.41 billion. Analysis of the number of projects financed under the CACS by value chain indicated, that of the 596 CACS sponsored projects, production accounted for 61.6 per cent and dominated the activities funded, while processing accounted for 27.7 per cent. These were followed by storage, input supplies and marketing, which accounted for 4.7 per cent, 3.3 per cent and 2.7 per cent, respectively”.