25 C
Abuja
Saturday, March 28, 2020

Reps laud NIRSAL MD, endorse agency’s agribusiness development drive

Must Read

Davido says his fiancé Chioma has coronavirus

  Music star Davido said Friday that his fiancé has tested positive for the coronavirus. He made the announcement on his...

Epidemic of Fear: Addressing Misinformation and Panic in Infectious Disease Outbreaks – Dr. Oreh

  By Dr Adaeze Oreh A few weeks ago,Masaka,the last patient receiving treatment for Ebola, the deadly viral haemorrhagic disease was...

Obasanjo donates his 32-room Hilltop mansion for COVID-19 isolation centre 

  In a rare magnanimity, Nigeria's former President Olusegun Obasanjo has handed over his 32-room mansion at Presidential Hilltop, Abeokuta, Ogun State, to...

 

Buoyed up by NIRSAL’s efficient service delivery, the House of Representatives has lauded efforts to reposition the risk-management agency as a major driver of agricultural development in the country.

The commendation came through the House Public Accounts Committee during an interactive session with the Nigeria Incentive-Based Risk Sharing for Agricultural Lending’s (NIRSAL) management on its ideas, mandate, track record and accomplishments.

The Chairman of the Committee, Mr Oluwole Oke, expressed his satisfaction with the performance of NIRSAL’s Managing Director, adding that NIRSAL had now found a friend in the form of the National Assembly.

He particularly applauded NIRSAL’s MD, Mr Aliyu Abdulhameed, describing him as “a round peg in a round hole and a man of undoubted capacity’’.

Persecondnews reports that other committee members also commended the agency’s performance in agribusiness financing and urged other agencies to take a cue from its rigorous processes of due diligence.

Addressing the Committee, Abdulhameed gave members an in-depth analysis context and rationale that informed the creation of NIRSAL, its mandate and the successes recorded so far in the nation’s  agribusiness space.

He explained that prior to the creation of NIRSAL, financiers were averse to lending to agriculture, citing perceived high risks in the sector, especially in the upstream segment of the agricultural value chain where primary production takes place, often referred to as the “black hole” in agriculture.

On the need to diversify Nigeria’s economy from crude oil based to agriculture-based, he said the Central Bank of Nigeria had formed NIRSAL with the objective of catalysing the flow of much-needed financing into Agriculture by redefining, measuring, re-pricing and sharing agribusiness-related credit risk with financiers.

“The CBN, in its foresight, established NIRSAL as a Public Liability Company registered under the Companies and Allied Matters Act. This gave financial institutions more confidence and ease to do business with NIRSAL as opposed to the limited transactions they could enter into with public sector institutions and the legal complexities therein.

“The agency is built on five broad pillars of Risk Sharing, Insurance, Technical Assistance, Incentives and Rating.  These strategic pillars are geared towards increasing bank lending to the agricultural sector by over 6% in the short to medium term, hence, bridging the gap between the finance and agricultural sectors.

“Principally, NIRSAL is facilitating finance to agriculture through its Credit Risk Guarantee (CRG). Through the CRG, NIRSAL shares either 30%, 50%, or 75% of agribusiness-related risk with financiers depending on the agricultural value chain segment receiving finance.

“Through the NIRSAL CRG, NIRSAL has attracted investment into agribusiness and guaranteed 697 agribusiness loans worth $505.9Million, paid N1.274 Billion Interest Draw Back to 271 obligors, creating over 400,000 direct jobs and impacting over 2,000,000 lives in the process.

“In terms of insurance, NIRSAL has developed and launched the Area Yield Index Insurance (AYII) product and protected up to N6.47 Billion in revenues of 35,492 farmers over 37,399 hectares of land with N122 million paid out in compensation to farmers,’’ the agency’s boss said.

Abdulhameed pointed out that NIRSAL had facilitated the granting of licenses to five insurance companies by the Nigerian Agricultural Insurance Corporation (NAIC) to underwrite index-based Agricultural insurance.

Leveraging on its Technical Assistance pillar, NIRSAL builds the capacity of financiers and agricultural value chain operators on agricultural lending and Good Agronomic Practices (GAP) respectively.

Accordingly, NIRSAL has trained 1,221 middle Management and Agric Desk Officers of commercial banks and provided training on GAP to 700,000 farmers and 74 Extension Workers.

It has also overseen the establishment of Risk Sharing Facility (RSF) models for African Countries under the aegis of the African Development Bank (AfDB), and recently, concluded the setup of the Togo Incentive-Based Risk Sharing System for Agricultural Lending (TIRSAL), known locally as Mécanisme Incitatif de Financement Agricole Fondé sur le Partage de Risques (MIFA).

On the agency’s relevance to the continent’s food agenda, Abdulhameed disclosed that other African countries have also sought NIRSAL’s assistance on how to set up similar agribusiness risk-sharing sharing outfit.

He listed such countries as Ghana and Benin among others.

The committee also tasked NIRSAL on tackling the issue of postharvest losses by strengthening commodity exchange systems in which farmers can trade their commodities round-the-clock.

Coincidentally, NIRSAL recently partnered with Wema Bank and Cellulant for the development and deployment of a commodity financing model designed to link small holder farmers in the upstream segment of the value-chain to community-based produce aggregators, and commodity buyers servicing the downstream segment.

Persecondnews also reports that a fall-out of the interactive session is the Committee’s recommendation for a workshop whereby NIRSAL will enlighten both the Senate and the House of Representatives on its operations to enable the lawmakers to educate their constituents on the overall benefits of the agency to small holder farmers.

- Advertisement -

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisement -

Latest News

Davido says his fiancé Chioma has coronavirus

  Music star Davido said Friday that his fiancé has tested positive for the coronavirus. He made the announcement on his...

Epidemic of Fear: Addressing Misinformation and Panic in Infectious Disease Outbreaks – Dr. Oreh

  By Dr Adaeze Oreh A few weeks ago,Masaka,the last patient receiving treatment for Ebola, the deadly viral haemorrhagic disease was discharged in the Democratic Republic...

Obasanjo donates his 32-room Hilltop mansion for COVID-19 isolation centre 

  In a rare magnanimity, Nigeria's former President Olusegun Obasanjo has handed over his 32-room mansion at Presidential Hilltop, Abeokuta, Ogun State, to the state government with immediate...

US not recruiting foreign medical professionals – US Embassy Nigeria

  The U.S Mission in Nigeria Friday said the United States is not recruiting foreign medical professionals to assist COVID-19 response. The US Embassy said the...

NNPC, Upstream operators, announce N11bn intervention to combat COVID-19

  An intervention fund of N11 billion ($30 million) has been announced by the Nigerian National Petroleum Corporation (NNPC) and 31 players in the upstream...

More Articles Like This

- Advertisement -