As part of efforts to boost palm oil production in Nigeria as a major producer globally, the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL Plc) has begun nationwide visits and sensitization of members of the National Palm Produce Association of Nigeria (NPPAN).
The latest drive is to Edo State where palm oil farmers are being sensitized on the NIRSAL Credit Risk Guarantee (CRG).
To date, NIRSAL Plc has facilitated well over N123 billion in commercial finance for projects in the agric value chain, leveraging its credit risk guarantee facility.
Persecondnews gathered that NPPAN covers about 486 local government areas in the 24 producing states of Nigeria, with Akwa Ibom, Edo, Ondo and Cross River being the largest producers of palm oil and its derivatives.
According to the non-bank financial institution, the CRG which is a vital tool in catalyzing the flow of finance into agribusiness, would help the farmers access commercial bank loans.
“The NIRSAL Credit Risk Guarantee (CRG) is the core service provided by NIRSAL Plc.
“By guaranteeing up to 75% of agribusiness loans, NIRSAL ensures that financiers’ funds are secure while agribusinesses and smallholder farmers receive the much-needed financing they require to enhance their operations and improve their livelihoods.
“The Credit Risk Guarantee (CRG) is NIRSAL’s major instrument for de-risking agriculture and facilitating agribusiness in Nigeria.
“Once NIRSAL’s Credit Risk Guarantee #CRG facility is activated for an agribusiness project, our field units are also activated to monitor the project throughout its lifecycle to ensure success and loan repayment,” NIRSAL said.
In 2020, United States Department of Agriculture (USDA) data, indicated that Nigeria produces about 1.015 million metric tonnes of palm oil despite the suitable agro-forestry zones and availability of labour.
According to the international organization, of the front runners in global palm oil production, it is only in Nigeria that oil palm development is subsumed within the Federal Ministry of Agriculture as no specific agency is focusing on oil palm.