1. Industry News

NIRSAL Promotes Inflow of Over N73 Billion into Agro-Processing Business

The NIRSAL CEO also stated that, in accordance with NIRSAL Plc's finance-facilitation mandate, SAPZ will mobilize private sector investment into the selected zones to boost productivity and integrate Agric commodity production, processing, and marketing.

Shivam Dwivedi
Food Processing Unit
Food Processing Unit

NIRSAL Plc (Nigeria Incentive-Based Risk Sharing System for Agricultural Lending) has facilitated the inflow of over N73 billion into Nigeria's agro-processing industry. This was revealed by Aliyu Abdulhameed, Managing Director of NIRSAL, during a media interactive session in Abuja.

While speaking about NIRSAL's accomplishments in carrying out its mandate of creating a stronger link between segments of Nigeria's Agricultural Value Chain (AVC) and subsequent AVC-linkage to commercial bank finance, Abdulhameed explained that the N73 billion flow into Nigeria's Agro Processing industry to date came from a variety of sources, including deposit money banks, development financiers, private equity investment firms, and other financial institutions.

Other beneficiaries of NIRSAL Plc's finance facilitation, according to him, include pre-upstream, upstream, and downstream AVC operators involved in Inputs Production and Supply, Mechanization Service Provision, Primary Production, and Logistics.

He also stated that this accomplishment, which has made a significant contribution to the Federal Government's Agric promotion drive, was accomplished through the effective deployment of NIRSAL Plc's Credit Risk Guarantee (CRG) instrument.

"In carrying out its mandate of strengthening the link between segments of Nigeria's Agricultural Value Chain (AVC) and subsequent AVC-linkage to commercial bank finance, the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL Plc) has facilitated the flow of over 73 billion into Nigeria's Agro Processing industry to date from various sources, including deposit money banks, development financiers, private equity investment firms, and individuals," he said.

"NIRSAL Plc's strategic support to Agro Processors operating in the AVC's midstream segment creates a profit-driven ecosystem in which farmers in the upstream AVC segment have a reliable market in the form of Agro Processors who offtake farmers' produce, add value, and satisfy consumer demand in the downstream AVC segment." NIRSAL Plc's support comes at a time when developing economies are increasingly shifting from producing only raw materials to producing both products and services.

"With the support of the NIRSAL CRG, farmer groups and agribusinesses that had previously found it difficult to secure loan approvals from commercial banks now enjoy smoother approval processes for the loans they require to expand their operations, increase their profits, and improve their livelihoods."

"NIRSAL Plc's constant engagements with commercial banks and training of their officers is also critical in the creation of NIRSAL CRG-backed loans." Over 4,250 bank officers have been trained on NIRSAL CRG guidelines and efficient Agric lending to date, resulting in a better understanding of the two, an improvement in banks' disposition toward Agric lending, and an increase in bank lending.

He stated that financiers can now confidently invest in profitable agribusiness ventures and that agribusinesses that borrow from them can improve productivity and profitability, generating much-needed local economic activity. According to him, NIRSAL Plc's investment in the agricultural sector has resulted in broad socio-economic growth.

"Specifically, NIRSAL Plc's finance facilitation efforts have generated an additional US$2.5 billion in economic activity through agricultural products/outputs and other value chain economic activities created 360,000 direct jobs, and improved the lives of 1.8 million Nigerians."

"As a result of NIRSAL Plc's risk-sharing model's success, commercial banks have pledged a total of US$500 million to fund agriculture and agribusiness." Furthermore, other African countries have approached NIRSAL Plc for assistance in the establishment and implementation of Risk Sharing facility models in their respective jurisdictions.

The NIRSAL CEO also stated that, in accordance with NIRSAL Plc's finance-facilitation mandate, SAPZ will mobilize private sector investment into the selected zones to boost productivity and integrate Agric commodity production, processing, and marketing.

Share your comments

Subscribe to our Newsletter. You choose the topics of your interest and we'll send you handpicked news and latest updates based on your choice.

Subscribe Newsletters