One key sector of the Nigerian life that is standing tall is the agricultural sector, courtesy of the current Agricultural Transformation Agenda, ATA, of the federal government, says Faith Tuedor-Matthews, group managing director of Mainstreet Bank. Speaking at the flag-off of the 2013/2014 Dry Season Farming Support Programme which held at the banquet Hall of the International Conference Centre Abuja, she described ATA as a revolutionary initiative which has accelerated the nation’s quest for food security and has further encouraged Nigerian banks to brace up to the challenge of lending to the agricultural sector.
Highlighting the experience of the banking industry prior to the introduction of the initiative, she noted that bank lending to the agricultural sector was below 1per cent of total bank lending. However, she said within two years this figure has grown to N368 billion which is a growth position of 4.29 per cent. She further noted that the banking industry has set a target to grow lending to the agricultural sector to 7 per cent and subsequently to 10 per cent by 2017. For instance, she noted that total bank lending under the Growth Enhancement Support Scheme, GESS, has grown from N4 Billion in 2012 to N20 Billion in 2013.
Explaining further, she said, through the Federal Ministry of Agriculture and Rural Development programme – the Nigerian Incentive-based Risk Sharing System for Agricultural Loans, NISRAL – the GESS initiative has successfully mobilised fertilizer agro-dealers, farmers, suppliers, seed companies to create an effective distribution mechanism that eliminates middlemen and the attendant corruption which existed in the input distribution chain.
Under the scheme, Mainstreet Bank lent N10 billion to 30 agro-dealers in 2013 and recorded zero default. She maintained that whilst previously the bank would not deal with agro-dealers because they lacked the structure to qualify for borrowing today the story is cheering as all the loans to the dealers are performing whilst through the scheme, over one million farmers have been reached and this translates to more jobs as a result of the additional hands who have been employed through this initiative.
According to her, following from the experience of Mainstreet Bank, many banks have now realized that lending to Agriculture is a viable business noting that there is great optimism that the target of N60 billion lending to the GES programme would be met and even surpassed. Her words: “Mr President, from our experience and the testimony of various stakeholders in the agricultural value chain, we affirm that the Agricultural Transformation programme is working.’’
The President Goodluck Jonathan commended Mainstreet Bank for rendering financial support to GESS and praised various stakeholders in the agricultural transformation value chain. He acknowledged that through the testimony of Nigerians he is further encouraged that indeed agriculture holds the key to the economic prosperity and food security of Nigeria. He later pledged that his administration would make available N14 billion to support the 2014 dry season farming, assuring farmers that the Dry Farming Support Programme would be made a national policy to enhance the growth of farmers and ensure food security in the country.
Akinwumi Adesina, agric minister, noted that the agricultural transformation agenda has enhanced food security for Nigerians and created many jobs, especially amongst many Nigerians who were ordinarily not accessible under the former system.