Ecobank Nigeria Limited is partnering with the Nigeria Incentive-based Risk-Sharing System for Agricultural Lending (NIRSAL), the United States Agency for International Development (USAID), the Development Bank of Nigeria (DBN) and other developmental partners to double the amount of credit it provides to the agricultural sector over the next two/three years.
Some of the partners would be providing guarantee on loans granted by Ecobank to Nigerian farmers and processors.
The Head of Agric Business Department of Ecobank Nigeria, Mojisola Oguntoyinbo, disclosed this in a statement.
“Separately, we are exploring partnership across the globe to support cheaper lines of credit to players in the industry through export credit agencies,” Oguntoyinbo said.
The bank plan to increase loan portfolio to the agricultural sector by N70 billion within the next two to three year and would hold an agribusiness summit next month themed – “Unlocking Productivity and Investment opportunities across Nigeria’s Agribusiness value chain,” Oguntoyinbo added.
The summit would target all players in all value-chain of the sector (input suppliers, crop and livestock producers, processors, commodity exporters etc).
Banks in Africa’s biggest oil producer are increasing lending to the agricultural industry amid a push by President Muhammadu Buhari’s government to diversify the economy away from crude. The Central Bank of Nigeria has regulated banks to maintain a minimum loan-to-deposit ratio of 65 per cent or face penalties, while supporting the government’s drive to produce more food locally and curb imports.
While Ecobank has a loan-to-deposit ratio of more than 65 per cent in Nigeria, it is targeting agriculture to boost its, “return on investment,” according to Oguntoyinbo.
“Small and medium enterprises are growing rapidly in the agricultural sector and there are opportunities there, which we desire to nurture for growth and development,” Oguntoyinbo added.