The Central Bank of Nigeria, CBN, has authorized commercial banks to give up to N2 billion maximum loan to youths interested in going into agriculture.
The loan, which comes under the Accelerated Agriculture Development Scheme at five per cent interest rate per annum was created by the apex bank in collaboration with state governments to engage 370,000 youth in agricultural production.
According to the loan guidelines released and signed by CBN Director Development Finance Department, Yusuf Yila Philip, the maximum loan accessible under the scheme shall be N2 billion per obligor.
Philip said the country’s population pyramid is bulging around the youth segment, with an estimated 75 per cent of the population identified to be aged below 35 years, saying a large segment of this population would have eked out a living if adequate opportunities were harnessed in agriculture given its potential of employing over 70 per cent of the nation’s workforce.
He listed agricultural commodities eligible for consideration under the scheme as rice, maize, cassava, cotton, wheat, tomato, poultry and fish, among others.
Philip said obligors are to have a contiguous land of not less than 20 hectares provided for specified agricultural commodities cultivation. Also, there should be evidence of land ownership in form of any acceptable title including lease of a minimum of 15 years.
He said the CBN will bear 50 per cent of the credit risk in the event of default by the participant while repayment of the facility will be made on installment basis through the participating banks and spread over the Economics of Production of the cultivated commodities.