CBN has mandated commercial banks in Nigeria to give up to N2 billion maximum loans to Nigeria youths interested in going into agriculture. This post is to create awareness for general public to apply for CBN P-AADS N2billion Agric-Loan.
The CBN P-AADS N2billion Agri-Loan, which comes under the Accelerated Agriculture Development Scheme (AADS) 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 guideline released on Tuesday and signed by CBN Director Development Finance Department, Yusuf Yila Philip, the maximum loan accessible under the scheme shall be N2 billion per obligor.
According to Yusuf Yila Philip, 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.
Yusuf Yila Philip 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.
According to him, 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 (EOP) of the cultivated commodities.
Participating banks are to conduct due diligence on prospective obligors, access funds from the CBN for on-lending and ensure that payments are made directly to mechanization service providers for the land clearing. The participating banks are to remit repayments received to the CBN on quarterly or annual basis depending on the commodity financed The Private Sector-Led Accelerated Agriculture Development Scheme (P-AADS) was also developed to complement AADS by exploring private sector partnership to facilitate more rapid land clearing for production of key agricultural commodities.
Requirements for CBN P-AADS N2billion Agric-Loan Application
- Be an existing or a new firm in agricultural production with proven capacity and bankable proposal
- You must possess the acceptable title for contiguous lands of not less than 20 hectares;
- Have a good credit record
- Be able to provide the required collateral for participation and
- You can provide evidence of the capacity to cultivate a local commodity directly or engagement of farmers. This includes youths as in-growers or out-growers to cultivate on the land after clearing