How to Finance Agribusiness in Nigeria
Various research has shown that agribusiness is one of the most profitable businesses among the various economic sectors in Nigeria. It is a given, Agriculture has been identified as the largest employer of labour in Africa, most especially Nigeria.
However, this sector is a gold mine yet to be fully explored, and this is an issue that demands discussion. The Agric sector has been a matter of serious concern to the federal government of Nigeria. There is a dire need to boost the country’s GDP through agriculture, raise exports, reduce importation and promote self-sufficiency.
The question of whether or not to farm is not a big deal, farming is a given. The catch however, is financing the initiative until it booms. How to secure a loan and what it takes to secure Agric loans in Nigeria. These are big questions that need to be answered urgently.
The main obstacle entrepreneurs encounter when they intend to venture into agribusiness is no longer whether it is worth investing in but the problem of fund.
For the sake of this piece, we have compiled a list of some government grants and loans available for Nigerian farmers to keep their business booming.
1. Bank of Agriculture
The Bank of Agriculture of Nigeria is the main channel that the government uses to provide loans and grants to the public. The bank is owned by the federal government, with the Central Bank of Nigeria and the Federal Ministry of Finance incorporated as shareholders.
The Bank of Agriculture (BOA) was established to help farmers develop their fields to any extent possible by giving low interest loans to qualified applicants.
The process of borrowing from BOA is not too strict compared to other loan rendering banks. BOA operates at a level of direct lending, collaboration, and credit monitoring.
However, Agric loan is not exclusive to BOA, other commercial Banks have also been partnering with the FG to assist Farmers.
2. CBN agricultural loans
Still piggybacking off the above, this loan scheme was set up by the federal government to provide low-interest loans to farmers in Nigeria. The Central Bank of Nigeria (CBN) recently approved the disbursement of about 75billion naira as loans to farmers and cooperative societies in all 36 states including the Federal Capital Territory (FCT). This loan can be accessed directly through the Bank of Agriculture.
3. Agricultural co-operative societies
Another way for farmers to secure agricultural loans is through cooperative societies. Credits given to these communities come as grants. As a rule, the cooperative societies could be provided with the grants by the banks who will then distribute it to each member on the basis of contributory payments. As a farmer, some of the most important agricultural cooperatives you can join are:
All Farmers Association of Nigeria (AFAN), Youth Empowerment in the Agricultural Program (YEAP), and FADAMA.
4. Attend Agro Conferences
After securing fund for your agribusiness, then what comes to your mind as a farmer when you harvest your farm produce? This is when attending conferences comes to place. Agropreneurs can get loads of insights and advantage from attending Agro-conferences.
Some of the things you can benefit from attending conferences is networking, meeting high net-worth individuals who are major stakeholders in the Agric sector and the general education attached.
One of the influential agro conference you can attend is the coming Meet The Farmers Conference (MTFC).
Meet The Farmers’ Conference is an agro stakeholders’ conference that aims to connect small and large scale agro commodity producers to buyers from the Middle East. Key Stakeholders from Africa and GCC will come together during a one-day event to network, collaborate, and form potential business partnerships across borders to ensure food security in the Middle East and promote agribusiness in Africa by tapping into the $100b GCC market.
More importantly; African farmers, participants, exhibitors and delegates at this event will be able to leverage on the business opportunities available to them in Dubai and other GCC countries.
Register here for the upcoming Meet The Farmers Conference in Lagos.
The first thing that comes to most farmers’ minds is to sell their Agric produce at the market after they have harvested. This is a great way to change that mindset.
In conclusion, Agribusiness in Nigeria has taken a dramatic turn to a better direction recently, creating jobs and opportunities for entrepreneurs who taken the bull by the horns and have invested into the farming business. Millionaires are being made every year through agribusiness and the figures are only expected to rise.