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Tag: NIRSAL

  • NIRSAL, German group boost agric projects

    The Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) has entered into a partnership with the German Agribusiness Alliance (GAA) to establish agricultural industrial projects.

    The aim of the partnership is to create a platform where economic ideas are exchanged to boost the successes recorded in agriculture and agribusiness.

    Read Also: Agric-value chain can provide 50m jobs – NASME

    Receiving the German delegates in Abuja, NIRSAL Managing Director Mr. Aliyu Abdulhameed said: “The partnership with the German Agribusiness Alliance and by extension, German agribusinesses, has been identified as a potential strategic leverage for obtaining invaluable benefits for NIRSAL and Nigeria towards the establishment of agro-industrial projects.”

    He noted that the partnership “will have enormous impact in Nigeria’s rural communities, given that upstream segment of Nigeria’s agricultural value chain is dominated by smallholders in rural areas,’’ adding that with the pull and push vibrations in the upstream segment, the midstream and downstream will also be impacted.

  • NIRSAL guarantees over N85.5b agric loans

    The Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) as a demonstration of its commitment to mechanising the agriculture sector, it has guaranteed over N85.5billion in loans along all segments of the value chain. It said while pre-upstream segment got N45.6billion, upstream segment and midstream segment got N19billion, and  N20.9billion respectively.

    Activities in these segments cover mechanisation, agricultural inputs, primary production, and processing.

    About N1.76billion of the  NIRSAL Credit Risk Guarantees (CRGs) issued were in mechanisation.

    In addition to paying claims on CRGs that crystallised to financiers, NIRSAL has paid about N1billion as its Interest Drawback (IDB) IDB to borrowers.

    A statement yesterday read: “A fundamental criterion is that every application must meet the terms of NIRSAL’s credit risk guarantees. These are components of governance to ensure a level playing field  “NIRSAL is a catalyst that enables providers of finance and investment to lend to and invest in agribusinesses, leveraging on its Risk sharing Facility to deploy the NIRSAL CRG and risk management products, tools, techniques, methodologies and strategic partnerships.”

    The CRG instrument is issued by NIRSAL to secure loans by up to 75 per cent of losses over the life of an underlying credit contract in the form of agribusiness related term loans, and/or debt instruments such as short, medium, and long-term notes.

    The guarantee covers the credit risk of default on loan principal and the accrued interest and is purchased at one per cent fee (upfront payment) of the loan value and subsequent outstanding balances of the loan annually.

    The purchase of a CRG also qualifies an underlying borrower, in principle, to access IDB- an interest rate rebate scheme that NIRSAL offers to borrowers whose facilities are in good standing.

  • Edo, NIRSAL, Sterling Bank partner on mechanised farming

    Building on the strides made in the agricultural sector in the state, the Governor Godwin Obaseki-led administration has concluded plans on a partnership with the Nigeria Incentive Based Risk Sharing System for Agricultural Lending (NIRSAL) and Sterling Bank on the development of at least 1500 hectares of farmland in different locations across the state.

    Edo State Acting Governor, Rt. Hon. Comrade Philip Shaibu, who disclosed this when a team from NIRSAL paid a courtesy visit to the Government House in Benin City, assured farmers in the state of adequate incentives to boost productivity.

    He said the state government is committed to the partnership which ensures that farmers get necessary financial support to fast track the introduction of mechanised farming in the state.

    According to him, “I commend the banking sector for coming to the rescue of the agricultural sector. They are making the process of introducing farmers to new techniques and technologies easy. This will help in boosting productivity.”

    He added that the state government designed an entrepreneur programme for youths, which will help in grooming them for profitable agribusiness.

    Special Adviser to the Governor on Agriculture, Forestry and Food Security Programme, Hon. Joe Okojie, reiterated that agriculture remains the easiest and fastest way to create wealth, noting “People don’t pay much attention to agriculture in this country, but this system seems different in the sense that it is going to be strictly mechanised. We aggregate all the farmers, link them to funding, inputs and markets.”

    He said there are off takers for whatever the farmers produce, which is going to boost their confidence in developing large expanse of farmland.

    READ ALSO: Immunisation: Edo reads riot act against exploitative health workers

    According to him, “For instance, we have a rice belt in Iguoriakhi, where we are doing above 500 hectares of rice. We aggregated all the farmers that have been traditionally farming rice and helped in developing the land. We brought in the NIRSAL, to take it from mechanisation to harvesting.

    “In Illushi, we are doing about 1000 hectares of rice farming. That is also in our rice belt. We would aggregate the farmers in that area and improve their productivity.”

    Head, Agricultural Field Services, NIRSAL, Ibrahim Abdullahi said that the collaboration between the organisation and the Edo state government would improve the fortune of farmers in Edo State.

    According to him, “We have already identified about seven locations. The farmers engaged in subsistence agriculture, and did not approach it as a business. The governor has given us the mandate to work with the farmers to train them to create wealth and ensure that they take farming as a business. We have been having technical meetings. We are going to deploy our full team to the field so they can commence delineation.”

  • CBN to establish Microfinance Banks in 774 LGs

    The Central Bank of Nigeria (CBN) is targeting to have Microfinance Bank branches in all the 774 local governments of the country.

    The capital base of the new NIRSAL Microfinance Bank will initially be N5 billion and as a first step, the apex bank said this new Microfinance banks which is a collaboration between the Bankers Committee, NIRSAL and NIPOST will see the establishment of seven Microfinance banks in the six geopolitical zones and the Federal Capital Territory (FCT).

    Thereafter the number will be scaled up to 50 Microfinance banks which are expected to become operational in the second phase of the launch of NIRSAL Microfinance bank. The first seven branches to be opened will be located in Ibadan, Port Harcourt, Bauchi, Kaduna, Enugu and Lokoja in addition to the one in Gwagwalada Abuja.

    Governor of the CBN Mr. Godwin Emefiele made this known on Wednesday at Gwagwalada, in Abuja when he embarked on a facility tour of Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) microfinance bank, an agribusiness initiative which provides risk for framers.

    According to Emefiele, “we are just inspecting one out of the first seven and we are scaling up to the next 50 in the next phase. We believe that before the end of this year, we would have moved substantially in making sure that they are set up and be able to provide finance to small businesses. This is collaboration between NIRSAL, bankers Committee and NIPOST and I want to say that we really need to set up Microfinance Bank that will reach out to the unbanked.”

    The CBN Governor lamented the lack of access to cheap finance by small businesses but noted that with the presence of a Microfinance bank branch in each local government across the country, the problem would be tackled.

    Emefiele told journalists that “the biggest problem small businesses always have, is access to credit; and I am happy that with the establishment of this microfinance bank which would be in at least one local government and we are talking about the 774 locations in all the country, we would be able to have a financial institution that will help deepen financial inclusion to make it easy for people to access credit particularly the small and unbanked people because we have always said that these are the very weak”.

    The creation of NIRSAL Microfinance Banks across the country he said “is to improve access to credit and the technology that would be used will be a fintech technology. We have already set a target for ourselves that by 2020, the rate of financial inclusion must increase to 80 percent from about 48 percent a year and a half ago. So this is just part of our initiative to deepen financial inclusion in Nigeria.”

    Mr. Emefiele said the hurdles of collateral for loans and interest rate, have been removed as the asset being financed will serve as collateral.

    According to him, “we know that those who are weak in terms of those who are unable to access credit, the big issue for them is inability to provide collateral. So they will be able to access credit without providing collateral. The asset that we are financing for them will act as the collateral which will be registered in our national collateral registry as something that is eligible to serve as collateral for loan”

    He added that “the loan is going to be disbursed from our AGMEIS scheme which is five per cent of profit after tax that is being set aside by the banks to support the small and medium enterprises that will be in agriculture or those that are into different type of small businesses that badly need to raise finance to be able to set up and earn livelihood. Interest rate for this will be at five percent and the loan will be for tenure of seven years with two years moratorium.”

    Reacting to concerns raised in some quarters that the creation of NIRSAL Microfinance Bank across the country will crowd out other Microfinance Banks, the CBN Governor assured that the fear of crowding out is unfounded stating that “the existing microfinance banks are doing their best. I have heard this is an attempt to crowd them out. This is not an attempt to crowd them out, but to complement their services and see to it that whatever service is being provided by these microfinance banks should be seen to be fair to their customers.”

    Emefiele also said he has heard about “the rural communities where the microfinance banks charge very prohibitive interest rate. But here, we are talking about making funds available to these people. This will help to create some form of competitive landscape so that those kinds of practices will no longer arise.”

  • NIRSAL acquires 10,000 hectares for wheat farming in Jigawa

    In a bid to boost wheat farming activities, the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) has acquired 10,000 hectares of land in Jigawa.

    The NIRSAL National Coordinator, Wheat Project, Mr Olu Anyo, made the disclosure during land preparation for the project at Hago village in Hadejia.

    According to Anyo, the move will boost wheat farming activities in the state and the country for food sufficiency and also increase farmers’ income.

    He said that the organisation had earmarked N285,000 for cultivation of each hectare, saying that the money would be paid to the farmers in form of farm inputs and not cash.

    The NIRSAL boss said that part of the organisation’s mandate was mobilizing funds for agribusiness.

    “We mobilize finances for Nigerian Agribusiness by using credit guarantees to address the risk of default.

    “We also reduce the cost of borrowing by agricultural producers from commercial banks,’’ Anyo said.

    Read Also: ‘Agric mechanization will help feed our growing population’

    In his speech, the state Wheat Project Coordinator, Alhaji Muhammad Idris, said the cultivation area would cover Ringim, Miga and Hadejia Local Government Areas.

    He said that 100 tractors had been acquired for clearing the land along the Hadejia valley.

    The NIRSAL was launched in 2011.

    It was incorporated in 2013 by the Central Bank of Nigeria (CBN) as a dynamic, holistic 500 million U.S. dollar public-private initiative to define, measure, price and share agribusiness-related credit risks.

    The goal of NIRSAL is to trigger an agricultural industrialization process through increased production and processing of the greater part of what is produced to boost economic earnings across the value chain.

  • CBN promises help for rural farmers

    Farmers in rural areas have cause to smile as the Central Bank of Nigeria (CBN) has pledged assistance towards boosting their yield as part of his social responsibility roles.

    Development Finance Officer, CBN, Ado-Ekiti Branch, Mr. Sowunmi Sogunle, disclosed this on Monday during a five-day training on Agricultural Value Chains Upgrade Services for National, Regional and Global Competitiveness.

    At the training, organized by the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending, (NIRSAL), an offshoot of CBN, Sogunle said the problems facing the average Nigerian farmer in the remote village, was of paramount concern to the bank.

    Sogunle said: “NIRSAL plays a key role in CBN intervention s such as the Anchor Borrowers Programme which focused at small holder farmers in rural communities

    “This is being done in order to boost their production, create employment and boost the Gross Domestic Product

    “NIRSAL, through us, has done quite a lot for the agricultural Value-Chain in Nigeria by reaching to the rural communities to create awareness on agricultural practice and opportunities, and this has helped reduce financial exclusion in their areas.”

    Read Also: ‘CBN needs to take more risks’

    The Project Monitoring Reporting and Remediation Officer of NIRSAL in Ekiti state, Mr. Ayo Ashade, in his welcome address, observed with regrets that principal among factors destroying farmers’ fortunes in the country was poor attitude of consumers to foods grown by local farmers, especially local rice.

    He enjoined farmers to cultivate habit of looking inwards by forming themselves into groups or cooperatives so as to benefit more from government programmes and policies.

    According to him, the goal of NIRSAL was to trigger an agricultural industrialization process through increased production and processing of greater part of what is produced on the farm to boost economic earnings.

  • $8.9b lost annually to post-harvest wastage, says NIRSAL

    Nigeria loses $8.9 billion annually to agricultural post-harvest losses as a result of poor and unsecured haulage system.

    The Managing Director,  Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL), Aliyu Abdulhameed made this known yesterday in Abuja, when he hosted private and public sector stakeholders to a technical session aimed at developing the Secured Agricultural Commodity Transport Corridor (SAT-C), its innovative system for fixing the key challenges facing the transportation of agricultural produce and products across the country

    NIRSAL’s objective for developing and proposing the SAT-C model, Abdulhameed said is to address the bottlenecks in the movement of agric produce and consequently reduce wastages resulting from late evacuation of particularly perishable produce from the farms.

    “The implementation of SAT-C is envisaged to reduce the prices of food commodities, enhance food security and increase the contribution of the Agriculture Sector to Nigeria’s GDP,” he stated.

    Abdulhameed enjoined participants to “take ownership of the model and make vibrant contributions to the realisation of a secured haulage system for Nigeria as it is expected to stem the tide of post-harvest losses which the Nigerian Stored Products Research Institute estimated to be $8.9 billion annually.”

    The NIRSAL boss said the joint framework to be arrived at would promote a model that manages the interests of all stakeholders, while the Federal Government works on developing the necessary alternative transport infrastructure that will enhance seamless movement of produce around the country.

    He pledged NIRSAL’s technical and financial support for the session throughout its duration, saying that Nigeria’s estimated population of 200 million people provides a captive market for agricultural products in Nigeria that is enough reason for big, bold steps to be taken in the Agriculture Sector in line with President Buhari’s “Eat what we grow and grow what we eat” mantra.

    The Director, Agricultural Business Processing, Marketing and Investment at the Federal Ministry of Agriculture and Rural Development (FMARD), Alhaji Musibau Azeez, representing the Minister, on behalf of the minister, said the ministry will support the initiative with the right policies to enable the emergence and operation of private sector haulage businesses.

    Other speakers at the opening phase of the technical session, included the Commissioner of Agriculture,  Kebbi State, Attahiru Maccido, representatives of the Corps Marshal of the Federal Road Safety Corp and the Commandant General of the Nigeria, Security and Civil Defense Corp, as well as heads of private sector businesses and agricultural cooperatives.

  • NIRSAL develops model to facilitate easy transportation of agric produce

    The Nigeria Incentive Based Risk Sharing System for Agricultural Lending (NIRSAL) is developing a transportation system to address bottlenecks in the movement of agricultural produce from farms to markets.

    A statement by NIRSAL’s Head, Corporate Communications, in Abuja, Ms. Anne Ihugba, said the system known as the Secured Agricultural Commodity Route (SACR), is targeted at significantly reducing the prices of agricultural commodities, and as well curb the astronomical losses that occured during post-harvest across the country.

    She said SACR would be built around four complementary components of agro-runners, secured commodity aggregation zones, specialised haulage services and dedicated commodity routes, pointing out that the components will enable farmers call and book for their produce to be picked up at the farm-gate and transported either to the designated aggregated zones or commodity markets.

    Ms. Ihugba said that logistics companies using specialised vehicles  to transport agricultural commodities around the country would offer the service and security agents would be informed of the movement of the specialised trucks to facilitate movement and timely delivery.

    She listed the  SACR routes as  Katsina, Jigawa, Kano, Kaduna, Niger, Kwara, Oyo, Osun, Ogun and Lagos states, among others.

    Ms. Ihugba said that NIRSAL would partner with the National Union of Road Transport Workers (NURTW) and the National Association of Road Transport Owners (NARTO) to implement the transportation system, adding that the organisation would also collaborate with agro dealers, produce aggregators, retailers, smallholder farmers, logistic service providers, state and local governments to facilitate the success of the system.

    “SACR model is geared towards facilitating agri-business and positively impacting rural economies across Nigeria, “ she said, adding, “NIRSAL will seek to collaborate with the Joint Tax Board (JTB), Association of Local Governments of Nigeria (ALGON), Federal Ministry of Agriculture and Rural Development.

    “Others are the Federal Ministry of Industry Trade and Investment (FMITI), Federal Produce Inspectorate Services (FPIS) and the Nigeria Agricultural Quarantine Service (NAQS).”

    She said the model is currently undergoing a comprehensive and rigorous process of internal testing before its formal deployment and is expected to take three months to implement starting from August 2018.

  • NIRSAL unveils improved insurance cover for farmers

    The Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) has developed a new insurance product which improves on its pioneering Area Yield Index Insurance (AYII) mechanism introduced last year.

    NIRSAL  said the product is especially targeted at small-holder farmers – the most vulnerable segment in the agricultural sector and the Nigerian population as a whole.

    Its Head, Corporate Communications, Anne Ihugba, in a statement explained said while the cover provided by the earlier product was limited to yield insurance, the new insurance product, NIRSAL Comprehensive Index Insurance (NCII) is a combination of Yield Index, Price Index and Life Insurance.

    She said the insurance “is designed to mitigate the impact and losses of both yield risk and market price risk – fundamental risks associated with possible production shortfalls and the uncertainties of the marketplace”.

    The new  product, an innovative form of revenue insurance, is unique in Africa. It is also the first such product to be achieved without government subsidies on the premium.

    The deployment of the product begins immediately with a pilot phase as part of NIRSAL’s operations in the CBN’s Anchor Borrowers Programme.

  • NIRSAL picks eight commodities for de-risking

    The Nigeria Incentive-Based Risk Sharing for Agricultural Lending (NIRSAL) will focus on de-risking eight agricultural commodities and their value chains, its Managing Director, Aliyu Abdulhameed told reporters on the sidelines of a training programme for NIRSAL, Central Bank of Nigeria (CBN) and Ministry of Agriculture workers in Abuja on agriculture value chain.

    He said by the end of the year for those eight commodities and their respective value chains, when fully de-risked, “will be able to convince finance and investment to take a position within a fixed value chain to either integrate the whole value chain to make financing easy.”

    Some of the selected commodities are livestock, cocoa and palm fruit.

    Abdulhameed said: “What we are trying to do is to set up roundtables with all actors along the value chain, from input supplier to processors, to logistics service providers and the in-market for each of those value chain.”

    This is because the rule of the theory behind value chain is that all actors in that chain are relevant and the chain is as strong as its weakest link and so there is no actor that will be left behind.