NIGERIA'S AGRIC CREDIT SCHEME SCORE CARD 2009-2016

The Central Bank of Nigeria has issued a formal report on the impact of the N200bn Commercial Agriculture Credit Scheme (CACS) introduced in 2009 as collaborative effort between the apex bank and the Federal Ministry of Agriculture and Water Resources.

The scheme was set up in 2009 with N200bn raised by the Debt Management Office through a 7 year bond.

It was intended to be made available to companies for agriculture and agric processing activities through participating commercial banks and through States if they choose to access maximum of N1bn for on lending to cooperatives in their domain.

The dream, says the CBN, was to fast track agricultural production, enhance food security, reduce agric credit cost, employ more Nigerians and raise foreign exchange earnings of the country.

According to the report, as the 7 year period expired on 2016, a total of 191 businesses across the country had benefitted from a total of N147.87bn disbursed.

Of this number, 151 or 79.1% were private limited liability companies with 77.6% or N114.729bn of the fund; 14 or 7.3% government owned with access to N16.35bn or 11.1%; 13 or 6.8% sole proprietorships given N4.737bn or 3.2% and 8 or 6.2% public limited liability companies given N8.655bn or 5.9% of the fund disbursed.

Others were 3 partnerships( 1.6% of beneficiaries) with N2.196bn or 1.5% of the fund and 1 cooperative given N200m of 0.1% of the fund.

According to the report. 80.2% of the disbursed were applied as expected in agriculture and related activities but 19.8% or N29.2bn was diverted to other areas not intended originally for the scheme.

The benefitting businesses were mostly into crop production (44.5%) livestock production (23%) , fish farming (6.15%) and agric processing (14.7%).

From data gathered from them, says the report, the funds helped grow their crop production by 26.69% average between 2009 and 2016 compared to national average growth of 9.69%; grew their livestock production by 65.33% compared to national 12% ; expanded their fish farming output by 42.63% compared to national average growth of 13.37% and lifted their food and beverages production by 84.26% compared to 10.91% average growth rate on the national level.

It was also discovered that beneficiaries injected additional capital they sourced from banks (64.5%); through equity (11.1%); from family and friends (3.8%) and from micro finance banks (0.4%).

The CACS funds, says the CBN report, were mostly employed in acquiring new plants, additional equipment or recruiting new hands to expand capacity or utilise existing one better.

However, the report still found that the businesses were also plagued by poor business plan, late disbursement of facility; shortfall in planned budget and bottlenecks of participating banks apart from ever present bureaucracy.

There was also the fear that absence of data from many of the States that participated in the scheme could be because most of the accessed monies were diverted to other areas.

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