Are you looking for guidelines on how to get Agricultural loan from banks? If yes, the information here will give you an easy guide on how you can access a loan from the bank for your agric bussines.
To support the growth of Nigeria’s agricultural sector, banks, microfinance organizations, and government organizations all provide agricultural loans.
These loans may be used to fund agricultural initiatives such as buying land, and seedlings, updating or purchasing farm equipment, establishing irrigation channels, constructing grain storage facilities, and other activities.
There are many financial institutions in Nigeria that gives loan to farmers with a friendly interest and repayment period. However many farms are not aware of such a great opportunity thereby Losing out on this opportunity.
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If you are into the agriculture business and funding is your challenge or you have a farmer around you, then read through this article as we will discuss how you can get an agricultural loan from Banks to support your Agric business.
How to Get Agricultural Loan from Banks
It is good to note here that there are some requirements that an applicant has to meet to access agricultural loan from Banks, some of them are:
- Outline a thorough business plan.
- Have the 20% down payment for the loan on hand.
- No matter how modest the amount, you should have been making deposits into your account with the bank for at least six months.
- You must also show that physical collateral exists.
However, these requirements might vary from one financial institution to another. Now lets list out the banks that gives agricultural loans.
Banks that Gives Agricultural Loans
1.) Bank Of Agriculture
The Bank of Agriculture (BOA) is a government backed bank that offers credit services to farmers and other agro-related enterprises, with the assistance of more than 201 retail locations around the country, six zonal offices, and its headquarters in Kaduna, the BOA plays a vital role in the agricultural sector by providing financial support to farmers in form of bank loans.
The Bank of Industry (BOI), the Central Bank of Nigeria (CBN), and the development finance institutions (DFIs) are just a few of the other Development Banks of Nigeria that the BOA collaborates with to give support to the agricultural sector.
You can visit the Bank of Agriculture (BOA) official portal here wwwboanig.com to get a loan
2,) Central Bank OF Nigeria (CBN)
CBN is another financial body that makes funds available for farmers to access with a low annual interest rate, CBN offers loans to current and future farmers. The CBN has invested more than $100 billion in the agricultural industry over the past ten years and made the fund available to all states through the Bank of Agriculture and other commercial banks.
You can visit the Central Bank of Nigeria (CBN) official portal here www.cbn.gov.ng to get a loan
3.) Micro SME Development Fund
The CBN introduced the MSME Development Fund on August 15, 2013, with a N220 billion share capital. 90% of the fund was made available to participating financial institutions (PFIs) at a rate of 2% for further lending to MSMEs at an interest rate of no more than 9% per year.
Farmers and investors in the agriculture industry are among the eligible recipients of this fund. Consequently, if you require a credit facility to grow your agribusiness, this may be helpful.
You can visit the Central Bank of Nigeria (CBN) official portal here www.cbn.gov.ng to get a loan
Conclusion
For Nigerians who desire to start an agriculture-related business or grow their current activities, these methods of obtaining agricultural loans in Nigeria are ideal.
