Lists of Bank that provides Agric Loan in Nigeria

The Importance of Agriculture in Nigeria’s Economy and Available Loan Options

The statement “If Agriculture does not grow, industries will remain stagnant” holds true, as many industries rely on agriculture for their raw materials. Agriculture serves as the foundation of Nigeria’s economy, employing over 40% of the workforce and making the largest contribution to the country’s GDP.

Given agriculture’s significant contribution to the economy, it deserves considerable attention and increased funding to propel the economy forward. The Federal Government of Nigeria, in collaboration with the Central Bank of Nigeria (CBN), has established several credit schemes to ensure adequate funding for the agricultural sector and its participants.

In this article, we will provide information about banks and institutions that offer loans to farmers, along with details about the loan products they provide.

Bank of Agriculture The Bank of Agriculture (BOA) is a financial institution established by the Federal Government of Nigeria, with the primary mandate of providing loans and credit facilities for agriculture. BOA offers support in the form of credits to all activities involved in the agricultural value chain.

BOA offers two loan products:

  1. Agriculture loan: Loans for all activities involved in the agricultural value chain.
  2. Micro loan: Loans available for small-scale agriculture and non-agriculture enterprises.

Key Points to Know about BOA Loans:

  • Collateral is required.
  • Very low-interest rates are offered.
  • Repayment terms are considerable and vary based on the purpose of lending or enterprise.
  • The loan process may be slow.
  • Loan applications are reviewed by experts.

BOA has branches nationwide, and to apply for a loan, you must visit the nearest branch in your state or locality.

First Bank of Nigeria (FBN) FBN provides agriculture loans to agribusiness owners or farmers through the commercial agriculture credit scheme, which is an intervention program by the Federal Government of Nigeria (FGN).

Key Points to Know about FBN Agriculture Loans:

  • The repayment term is 5 years.
  • The interest rate is approximately 10%.
  • Eligible individuals can access loans worth up to ₦1 billion if requirements are met.
  • Applicants must have at least ₦50 million worth of assets.
  • To apply, visit the nearest FBN branch in your area for inquiries.

Other Banks under the Commercial Agriculture Credit Scheme:

  • Union Bank
  • Access Bank
  • United Bank of Africa
  • Jaiz Bank
  • Other Microfinance Banks

Many banks in Nigeria now offer agricultural support funds with varying requirements. Some banks known to provide loan support and grants for agribusiness at the time of writing this article include:

  • Keystone Bank
  • Fidelity Bank
  • First City Monument Bank (FCMB)

Agricultural Cooperative Societies: Another option for obtaining loans to fund agricultural value chain activities is through agricultural cooperative societies. These cooperatives consist of farmers with similar financial goals, and loans are granted based on stringent measures established by the society.

Loans from cooperatives are usually offered to regular members with good credit records. The interest rates are typically low, and the repayment periods range from short to medium-term.

Conclusion: Agriculture and agribusiness involve inherent risks, which often make institutions skeptical about lending money to farmers. As a result, agricultural loans usually require collateral. However, with the various loan options available through banks, cooperatives, and government interventions, farmers and agribusiness owners have opportunities to access the necessary funds for their agricultural endeavors.

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