Anchor Borrowers: CBN Condemns the IMF’s Bad Rating

As of February 2023, farmers have returned N503bn, or 52.39 percent, under the Anchor borrowers scheme, according to data released by the Central Bank of Nigeria.

On Monday, AbdulMumin Isa released a statement as the department's acting director, of corporate communications.

Although, the International Monetary Fund's assertion that just 24% of loans made under the Central Bank of Nigeria's Anchor Borrowers' Programme have been repaid runs contrary to this number.

While the CBN does enable farmers to pay in kind or cash under the Anchor Borrowers' Programme, ABP, repayments have been extremely low, according to a study finished on January 12th, 2023.

The statement stated, “Repayment under the Anchor Borrowing Programme is also modest at 24%, especially as payback can be paid in kind, so restricting the duration of the loans to one year. The finance is sometimes utilized for other purchases (such as new agricultural input trading businesses to elicit trade rents), and the recipient loans are not always effectively targeted.”

Isa denied the allegations and provided details on how the scheme had really resulted in the release of N1.079 trillion, of which N960 billion is now due. He claims that because of the CBN initiative, 4.45 million smallholder farmers have been able to grow approximately 6.02 million hectares of land, yielding 21 different commodities.

The acting spokeswoman cited FAO data showing that national output of primary commodities, such as maize and rice, peaked at 12.2 and 9.0 million metric tons in 2021 and 2022, respectively.

According to him, the COVID-19 forbearance granted to the beneficiaries of the apex bank's operations in March 2020 and extended until February 28, 2022, has put a hold on the collection of the outstanding due amount on loans.

Loan terms under the ABP are determined by the average gestation length for each commodity. He mentioned that farmers who grow perennial crops can be eligible for longer-term loans (up to seven years) than those who grow annuals.

"The Central Bank of Nigeria continues to back the Federal Government's efforts to ensure food security and boost the economy by fulfilling its developmental mandate of increasing access to credit for the real sector, especially agriculture. Therefore, applications for the Anchor Borrowers' Programme from qualified Nigerian farmers and businesses are still being accepted by the Central Bank of Nigeria," he said.