Nigeria’s agricultural sector is facing a daunting challenge as farmers and agricultural firms grapple with repaying a staggering N380.97 billion in loans provided by the Central Bank of Nigeria (CBN) under various intervention programs.
The due amount comprises both unpaid principal and accumulated interest, according to detailed data from the apex bank.
This revelation sheds light on the significant hurdles the CBN encounters in recovering funds disbursed to stimulate agricultural productivity and enhance food security. Despite the CBN’s efforts to inject approximately N2.07 trillion into agricultural development through eight targeted loan programs, repayment struggles persist, raising concerns about the sustainability of these interventions in bolstering the nation’s economy.
Among the notable intervention schemes are the Accelerated Agricultural Development Scheme (AADS), Anchor Borrowers’ Program (ABP), Commercial Agriculture Credit Scheme (CACS), Maize Aggregation Scheme (MAS), National Food Security Program (NFSP), Paddy Aggregation Scheme (PAS), and Rice Distribution Facility (RDF). While some programs have witnessed substantial disbursements and repayments, others face considerable outstanding balances and repayment arrears.
For instance, the ABP, with a disbursement exceeding N1.12 trillion, confronts an outstanding principal balance of N581.87 billion and due repayments totaling N367.06 billion. Similarly, the CACS reports an outstanding principal of N115.26 billion, while the NFSP faces an outstanding principal of N32.27 billion, further exacerbating the repayment challenges.
President Bola Tinubu’s directive to security agencies to assist the CBN in loan recovery underscores the severity of the situation. Additionally, the CBN’s suspension of new loan applications under its intervention program reflects the bank’s recognition of the need for robust measures to address repayment failures.
Despite recent contributions to the agricultural sector, such as the donation of over 2 million bags of fertilizers valued at N100 billion, questions linger regarding the effectiveness of these initiatives in alleviating the repayment crisis. Clarifications from the CBN indicate that these donations are part of existing programs initiated by previous administrations rather than new intervention efforts.
As the CBN grapples with mounting repayment challenges, stakeholders await decisive actions to safeguard the sustainability of agricultural financing and ensure the success of future intervention programs in driving economic growth and prosperity.
