Agriculture is one field that requires as much funds as possible. Are you into Agriculture and its related businesses? Then this CBN ABP Initiative is for you. With the help of the CBN ABP Initiative, you can begin a business, grow and expand your agricultural businesses. The need for food and consumables can never be overemphasized. Now let us check out the CBN ABP Initiative.
What is the CBN ABP Initiative?
The CBN ABP loan is an initiative set out by the Central Bank of Nigeria and is focused on promoting agribusinesses amongst Nigerians. ABP stands for Anchors Borrowers Programme and is targeted towards smallholder farmers that base on production of identified commodities across the country. The CBN ABP Initiative also has the objective of increasing agricultural output and improving capacity utilization of processors as well.
Terms and Conditions of the CBN ABP Initiative
Financial Institutions: The financial institutions responsible for funds disbursement are Deposit Money Banks (DMBs), Development Finance Institutions (DFIs), and Microfinance Banks (MFBs).
Interest: The interest rate of the CBN ABP Initiative is rated at 9% per annum.
Tenor: The amount loaned out must be paid fully with interest within the duration of time needed for commodity to be harvested.
Repayment: Repayment is done mostly with goods / commodities produced.
The CBN ABP Initiative is set out majorly for farmers to boost crop production and distribution. Other businesses in line with the CBN ABP Initiative may also apply.
The farmers trying to benefit from the programme must be in a cooperative in groups of between 5 – 20 persons. This would make the process of receiving assistance faster.
Approved Commodities for the CBN ABP Initiative
The commodities that were approved for this programme are listed below.
- Legumes such as Soybean, cowpea, sesame seeds etc.
- Cereals such as rice, maize, guinea corn etc.
- Tree Crops such as Cocoa, Oil palm, Rubber etc.
- Roots and tubers such as Yam, potato, cassava etc.
- Livestock such as Poultry, Fish, Ruminants etc.
Take note that with time some commodities may be included, so this list should not limit you.
How Does the CBN ABP Initiative Help Farmers?
What this programme does is that, it looks out for big time large-scale processors or input suppliers. Then the ABP searches for small agribusinesses and their owners. Then the Anchor Borrowers Programme creates a link between the large-scale processors and smallholder farmers (SHF) of the approved commodities.
The CBN ABP provides farm inputs to the farmers. This input may be cash or kind for example, farm labor can be supplied to aid production of commodities. This assistance is given to boost production of commodities, reduce unemployment, address the negative balance of payments on food etc.
When commodities are fully produced and harvested, they are supplied to the large-scale processors (the anchors) and cash payment is made to the smallholder farmer (the borrower).
Is it just me or are there so many loans for Agriculture? Well, good luck to us in the Agribusinesses’ here’s another loan centered on Agribusiness that you can read up;
Thanks for reading this One Smart Way of applying for the CBN ABP Initiative. Do share and leave your thoughts in the comment section.