The Central Bank of Nigeria has said the total loans disbursed to farmers under the Anchor Borrowers Programme rose to N948billion in February.
The banking sector regulator stressed the need for insurance cover for farmers under the programme.
“Specifically, under the Anchor Borrowers Programme, we have disbursed N948bn to 4,478,381 smallholder farmers who cultivated 5.2 million hectares of farmland across the country, thereby creating 12.5 million direct and indirect jobs,” said the CBN Governor, Godwin Emefiele, in a speech obtained on Friday from the bank.
The CBN assigned the duty of providing covers and assessing risk of farmers under the APB to the underwriting firms.
The Development Finance Department of the CBN disclosed this in its revised ABP guidelines.
According to the guidelines, the underwriters should provide insurance cover for the projects; ensure timely processing and settlement of claims; provide technical assistance to farmers on insurance policies; and monitor projects for early warning signals or red flags.
The CBN said they should “render periodic report on farm conditions; serve as member of the project management team; and carry out any other responsibilities as may be prescribed by the CBN from time to time,”
The revised guidelines addressed current realities and developments in the programme, aimed at promoting best practice in its implementation.
The CBN recognised the distinctiveness of smallholder farmers, the ABP transactions dynamics and the project management team in the implementation process.
It also adopted measures to ensure the protection of smallholder farmers.
According to the regulator, the broad objective of the ABP is to create economic linkages between smallholder farmers and processors with a view to increasing agricultural output and ensuring food price stability.
