CBN plans driving agribusiness through 50bn credit facility, interest rate cut

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The Central Bank of Nigeria as a mean of mitigating the impact of the novel coronavirus on micro, small and medium-sized businesses MSMEs, recently unveiled a 50 billion credit facility and cut down the interest rate on intervention funds from nine to five per cent among other measures to support businesses.

Stakeholders in the agricultural sector lauded the step by the apex bank to help agribusinesses survive in this difficult moment of the economic fallout of the COVID-19 pandemic as well as prepare the sector for the post-COVID era.

For agriculture and agribusiness, an extension of moratorium and reduction of interest rate will benefit small and medium scale agribusiness as well as agro-allied industries.

“However, the government can do better by honestly earmarking a large percentage of N50 billion strictly for agribusiness, making it accessible and as well making the potential beneficiaries aware of the availability of this facility by way of advertisement.”

“The CBN’s support is very crucial at this time and we must commend them for the recent reduction of interest rate on intervention funds from nine to five per cent but this support has to be ongoing,” Mr. Ibrahim Kabiru President of All Farmers Association of Nigeria (AFAN)

He noted that thousands of smallholders under the CBN’s intervention programmes will benefit from the recent cut and this will further impact their production capacity greatly.

He had earlier said the government should offer stimulus to the Nigerian farmers for food crops in the interim. The stimulus, he too suggested, should be in the form of seeds, fertiliser, agro-chemicals, water pumps and other irrigation equipment as well as some cash for farm labour.

The reduction of interest rate from 9 % to 5% and the extension of the moratorium for loan repayment as well as the 50 billion NIRSAL Microfinance stimulus window for MSMEs will mitigate the adverse effects of the pandemic and stimulate recovery, no doubt.

No fewer than 3,256 individuals and small businesses had so far benefited from the TCF to cushion the effects of COVID-19.

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