The Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) and Stanbic IBTC Bank have signed a N50 billion Memorandum of Understanding for agricultural finance scheme.
The Managing Director, NIRSAL Aliyu Abdulhammeed revealed this at the launch of the N50 billion NIRSAL, Stanbic IBTC agriculture finance scheme in Abuja.
He said the project was the continuation of its effort to boast agricultural productivity and modernisation by facilitating increased bank lending to the sector.
He said: “Stanbic IBTC has committed an initial N50 billion for the takeoff of the scheme. The amount is to be expanded gradually as milestones are achieved. The first phase of the scheme is projected to create over 92,000 direct jobs, impact about 200,000 lives boasts incomes of rural farmers and compliments government, s efforts to drive inclusive economic growth through agriculture.
“It will also lead to the cultivation of an additional 11.195 hectares of arable land, increase in the national food output by up to 50, 580mtin yeild and add N3.87 billion value addition. Under the terms of the partnership, NIRSAL is to provide credit guarantee to cover up to 75 per cent of Stanbic IBTC loans to bankable agricultural projects using its $300 million risk sharing facilities.
“The partnership is in line with NIRSAL mandate to attract private sector finance to agriculture. This partnership marks the start of NIRSAL’s long term collaboration with Stanbic IBTC to ensure that commercial agriculture is entrenched and made a main stream occupation.
The M.D Stanbic IBTC, Demola Segunle said this partnership is the march towards diversification, the Nigerian economy he said is diversified but the government revenue is concentrated on oil and gas. We came up with a productive programme of N10billion to turn agric chain to something that can generate revenue for the country. We test every agric project we embark on for legibility. Our risk criteriab has to align with that of NIRSAL. This is a long term partnership for both organisation.
The partnership will cover NIRSAL supported projects in livestock, crops, mechanisation, logistics and poultry. Both firms are in partnership for the 2017, 2018 dry and wet season.