The federal government is offering grants to farmers engaged in doing research or having working capital for farming activities.
Most grants are conditional, meaning farmers have to complete a submission detailing why they are applying for funds.
Grants constitute a form of financial aid. These usually do not need to be repaid, unlike student loans. But if the duties have not yet been met, most or all of the grant will be refunded.
An agricultural loan is an overdraft provision which could be used to cover the costs of manufacturing, manufacturing and working capital operations for the agri-business and related activities.
Agriculture loans are usually low-interest loans that farmers can take advantage of to more efficiently operate their farming sector.
However, in order to score a government grant for farm equipment, you have to know what steps to take.
- Get a Farm Business Plan.
- Research Grant Opportunities.
- Contact Grant Administrators.
- Apply for Grants.
- Wait to Receive Approval.
Agricultural loans in Nigeria are much and The land available in Nigeria is clearly overwhelming for farming activities.
A recent survey revealed that there are about 84 million hectares of arable land in Nigeria, from which only about 40 percent have been grown.
Add our desirable weather conditions that sustain the growth of farm products such as groundnut, rice, cocoa, cashew, cassava, palm oil, to name but a few, and you start to get a picture – Nigerian agriculture is a lucrative investment.
The problem young people have is they think of dabbling into entrepreneurship and not about whether agriculture business is worth any investment.
We’ll talk about some government grants and loans that are available to Nigerian farmers in this post just to keep their business booming. Government Loans And Grants In Nigeria is Among the most effective methods any government can use to promote the involvement of its people in farming and farming practices is developing avenues in which they can access government grants and loans.
The federal government of Nigeria has arranged various schemes and programs that would provide loans and grants to smaller and larger-scale farmers to support the growth of the agricultural sector and to enable farmers and investors to adopt agriculture.
Such credit facilities are made freely accessible by the federal government and cover a wide range of agricultural activities including crop growing and livestock rearing.
There are several avenues that the government has established for accessibility to agricultural loans for individuals and corporate bodies.
Some of them include: CBN agricultural loan to both small and large scale farmers in Nigeria and Bank of Agriculture loan
1. CBN agricultural loan
The federal government developed this loan scheme that can provide low-interest loans to Nigerian farmers. The Central Bank of Nigeria (CBN) has given the go ahead on the disbursement of some 75 billion naira as a loan to farmers and cooperative societies located in the 36-state and Federal Capital Territory (FCT). This loan is directly accessible from the Bank of Agriculture.
2. Bank of Agriculture (BOA) loans
Nigeria’s Bank of Agriculture is the key mechanism that the government uses to offer the public loans and grants. The bank is controlled by the federal government, including as shareholders Central Bank of Nigeria and Federal Ministry of Finance.
The activities of the bank are under the control of the Federal Ministry for Agriculture and Rural Development. The BOA will be your first preference when focusing on government loans. Bank of Agriculture (BOA) LOANS Requirements You must have established a minimum customer account relationship for around six months You should have made a deposit at least 20 percent of the loan sum needed into the account. You must have to submit a detailed business plan to get this loan.
Nonetheless, the conditions for securing a loan are subject to compromise and will largely depend on the viability of your farm plan. Further information on the BOA loans can be found on the BOA website. Many means of receiving agricultural loans are available apart from the BOA.
The federal government has collaborated with various commercial banks via the Bank of Agriculture and the Bank of Industries to help farmers get loans.
Many of the commercial banks to which you can apply for loans are Union Bank; Zenith Bank; First Bank; UBA; Stanbic IBTC.
Requirements for obtaining credit from commercial banks also provide loans for agricultural purposes for individuals and cooperatives.
There are a number of credit facilities you can apply for through commercial banks, this includes: short-term loans, medium-term loans, and long-term loans.
The general requirement for most Nigerian commercial banks includes:
Apply to have an account with the bank;
Put up a loan application;
Deposit at 10% or more of the total money you applied for;
Provide the bank with collateral;
Provide a comprehensive business strategy with a full feasibility report. For more details on government loans available from commercial banks, please contact any representative of the bank in your region for more information.
3. Agricultural co-operative societies
Via cooperative societies, the simplest and surest way to obtain agricultural loans is. Such societies ‘credits come in as grants. In general, the banks would provide grants to cooperative societies, which would then allocate it to each representative on the basis of consequential payments.
Some of the most relevant farm cooperatives you can enter in accessing loans are: All Farmers Association of Nigeria (AFAN); Youth Empowerment in the Agricultural Program (YEAP); FADAMA. Access by cooperative societies to government loans and grants from banks is comparatively simpler-the basic criteria include:
- Create a cooperative society;
- submit an application for a loan
- write to the bank with the cooperative letterhead.
The request should be signed by a representative of the cooperative; submit a comprehensive feasibility report on the company.
By making loans and grants available, the federal government is paying greater attention to the agriculture sector. Most experienced farmers have seized this opportunity and are now simply reaping the benefits. Today you can even get launched and come into your own wealthy world.