The Anchor Borrowers Scheme (ABS), for which N40bn was earmarked by the Central Bank of Nigeria (CBN) in 2016, may soon breathe its last breath if rice farmers who benefited from the single digit interest rate (9%) loans fail to repay. Recently, Chairman of Kano State Anchor Borrowers Recovery Team, who is also the Managing Director of Kano Agricultural and Rural Development Authority (KNARDA), Professor Mahmud Daneji, shocked Nigerians when he revealed that out of the 5,540 beneficiaries in Kano State, only four had successfully paid back.
With such attitude, the objectives of the Anchor Borrowers Scheme will be defeated. CBN projected that the scheme would create jobs, reduce food imports, diversify the economy and empower over 600,000 agripreneurs. Apart from these it was expected that some one million direct and indirect jobs would be created in the implementation of the scheme targeted at the mass production of rice, oil palm, wheat, fish and cotton.
Current statistics prove that in spite of the bumper harvest of the last season, rice production was still a half of local needs. Out of an estimated 4.7 metric tonnes of rice consumed in this country annually, local production was put at 2.4 metric tonnes. Deepening this scheme would have helped in bridging this gap, thus reducing smuggling and importation of rice into Nigeria. For the ordinary Nigerian, more local rice production would bring down the price of rice, making it senseless to crave for imported brands from Thailand, India and other Asian countries.
Beneficiaries of ABS have given several reasons for not repaying the loans. Some have claimed that the seeds, fertilizer and farm equipment provided to them did not arrive until after the planting season. Those vested with the task of implementing the scheme should be held responsible for such untimely response which has harmed the Anchor Borrowers Scheme. Improved seeds and equipment not provided at the time of need are as useless as when they are never provided. Those who caused the delay should not be left unpunished.
It was observed, however, that there was no proper screening of recipients of the loans such that some so-called farmers who didn’t have farmlands benefitted from the loan. They received the seeds, fertilizer and equipment which they sold for cash. This is incredible, but it is evidence that CBN and other agencies involved in the disbursement of the loans did not do proper background checks before disbursing the loans. Many people got the impression that ABS is political largesse, the farmers’ share of the national cake which is not to be repaid.
For this scheme to survive, it is pertinent for CBN to verify the claims by beneficiaries that they have farms. This must be painstakingly done. Secondly, it should be drummed into the ears of recipients that ABS is a repayable loan, not a free gift, and that the money is meant for farming, not for buying new cars or marrying new wives. Without such sensitization, the circle of non-repayment of the loan under this scheme would not be broken from year to year.
It is also necessary to free it from political influence because if they are dispensed using any political party’s structure, the loan will be given political colouration and will not be repaid. Secondly, farmers should be made to form cooperatives such that they would have a leader per community, and each farmer watches over others. This way, those who default in repaying their loans would be compelled by other members of the cooperative to pay up, as repayment by all will be a pre-condition for the group to access future loans. Furthermore, it has become vital for the farmers to register for agricultural insurance in case of unavoidable crop failure. Anchor Borrowers Scheme is CBN’s very laudable attempt to provide capital for farmers. It should not be killed prematurely by those the scheme is meant to serve.
