The CBN has launched the P-ADDS initiative aimed at engaging 370,000 youths in agricultural production.
The P-ADDS was designed to complement ADDS by exploring private sector partnership to facilitate more rapid land clearing for production of key agricultural commodities.
The broad objective of the P-AADS is to facilitate increased private sector agricultural production of staple foods and industrial raw materials, as well as support food security, job creation and economic diversification.
Eligible participants are; Agro-processors of agricultural commodities engaged in backward integration; Prime anchors and commodity associations participating under the Anchor Borrowers’ Programme (ABP) with evidence of contiguous land readily available for clearing and cultivation of agricultural commodities.
The CBN on Tuesday, November 10, disclosed this in a statement titled: “Guidelines for the Private Sector-led Accelerated Agriculture Development Scheme,”.
The guideline also states agricultural commodities eligible for consideration under the Scheme as rice, maize, cassava, cotton, wheat, tomato, poultry, fish, sorghum, oil palm, cocoa, livestock/dairy and any other commodities as may be listed by the CBN from time to time.
The CBN, in a circular titled: “Guidelines for the Private Sector-led Accelerated Agriculture Development Scheme,” signed by the Director, Development Finance Department, Mr. Yusuf Yila, said the scheme shall be funded from the Anchor Borrowers’ Programme (ABP).
The CBN pegged the maximum loan accessible under the scheme at N2 billion per obligor- and to be repaid from the Economics of Production (EOP) for cultivating on the cleared farmland.
- Be existing or new firms engaged in agricultural production with proven capacity and bankable proposal.
- Possess an 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.
- Provide evidence of capacity to cultivate a focal commodity directly or engagement of farmers, including youths as in-growers or out-growers to cultivate on the land after clearing.
The guidelines specified infractions and sanctions against participating parties.
According to the CBN, diversion of funds by the participating banks shall attract a penalty at its maximum lending rate at the time of the infraction.
In addition, such PFI shall be barred from further participation under the scheme.
Also, non-rendition or false returns shall attract the penalty stipulated by BOFIA, while charging interest rate higher than prescribed shall attract the penalty stipulated by BOFIA.
The CBN said any participating bank that fails to disburse the fund within the stipulated days of receipt to the borrower shall be charged penalty interest at the PFI’s maximum lending rate for the period the fund was not disbursed.
Also, failure to remit repayments received to CBN within the stipulated period shall attract penalty interest at the PFIs maximum lending rate.