Monday, 9 June 2014

Central Bank of Nigeria (CBN) has disbursed N75.92 billion under the Commercial Agriculture Credit Scheme (CACS). Guidelines scheme to be amended.

Central Bank of Nigeria (CBN) at the weekend said it has so far disbursed a total of N75.92 billion under the Commercial Agriculture Credit Scheme (CACS).
According to the CBN data, published by its Development Finance Department, a total of 886,703 projects have benefitted between 1978 and last month from the scheme, an initiative of the apex bank, and the Federal Ministry of Agriculture.
Other stakeholders in the scheme include state governments, deposit money banks and micro-finance banks.
According to report on the performance of the scheme posted on the apex bank’s website, a total of N997.085 million was granted in loans for the month of May to 4,811 projects, out of which individuals beneficiaries accounted for N977.285 million across 4,749 projects.
Yobe State got N145.34 million for 251 projects; followed by Delta’s N124.1 million to 354 projects.
During the period, total loans fully repaid for the month stood at N542.785 million, representing 2,388 projects, led by Cross River with N179.42 million in 266 projects.
Loans to food crops during the period stood at N441.038 million in 2,789 projects, with tuber and roots having N215.8 million in 1,171 deals.
The May 2014 figure brought the total loans in April and May to N1.84 billion for 10,095 projects, with individual sponsored projects getting N1.715 billion in 9,928 projects.
Since inception too, the year 2011 has recorded the highest amount of disbursement with N10.189 billion to 56,328 beneficiaries, followed by N9.424 billion to 56,277 projects in 2013.
Between January and May, the report said, total loans under the scheme amounted to N4.456 billion in 27,162 deals, with N2.601 billion going through the participating banks to 7,877 projects, while microfinance banks on-lent the remaining N1.854 billion to 19,285 beneficiary projects.
The lion’s share of the disbursement has been through the Union Bank of Nigeria, which recorded N1.925 billion to 5,785 beneficiaries; followed by First Bank of Nigeria’s N606.02 million to 1,912 projects.
Within the five month period also, the apex bank put total loan repayment at N3.278 billion, led by Lagos State’s N356.71 million from 755 beneficiaries; ahead of Delta’s N318.23 million in 626 projects.
Meanwhile, the circular by the CBN, pasted on its website also on Friday, said under the scheme, “a commercial enterprise is any farm or agro-based enterprise with agricultural asset (excluding land) of not less than N100 million for an integrated farm with prospects of growing the assets to N250 million within the next three years and N50 million for non-integrated farms/agro-enterprise with prospects of growing the assets to N150 million, except in the case of on-lending to farmers’ cooperative societies.”
While all deposit money banks are participants, they are to sponsor projects from any of the target areas indicated in the guidelines and bear all the credit risk of the loans they will be granting.
They are also to ensure that “single obligor for any project from a participating bank under the Scheme shall be N2.0 billion while for State Governments shall be N1.0 billion”.
The apex bank also released an amended guideline for the CACS drawn in conjunction with the Federal Ministry of Agriculture.
Under the new guideline, participating banks that diverts the funds, including being “barred from further participation under the scheme, (while) non- rendition or false returns shall attract the penalty stipulated by BOFIA section 60”.
Banks that charge “interest rate higher than prescribed shall attract the penalty stipulated by BOFIA section 60”, according to the guideline dated May 14.
Similarly, participating banks “that fail to disburse the fund within 14 days of receipt to the borrower shall be charged a penalty interest rate of MPR+300 basis points for the period the fund was not disbursed”.
“Failure to disburse funds in line with the agreed disbursement schedule shall attract penalty at the bank’s lending rate as at the time of infraction; (also) any PB that fails to repatriate expired project funds within five working days to the CBN shall be charged a penalty interest rate of MPR + 300 basis points for the period the fund was not repatriated.” (Source - Daily Independent)

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