Business

FG raises agric credit guarantee fund to N50bn


In a move aimed at further improving output in the sector, the Federal Government has increased the share capital of the Agricultural Credit Guarantee Scheme(ACGSF) to N50 billion from N3 billion, New Telegraph learnt yesterday.

 

According to a document entitled, “Agricultural Credit Guarantee Scheme Fund (Amendment) Act 2019,” seen by New Telegraph, the ACGSF Amendment Act was assented to by the Federal Government on June 24, 2019.

 

The document shows that complete agricultural value chain financing is now allowed under the ACGSF Amendment Act 2019.

 

Specifically, the document states that “under the Agricultural Credit Guarantee Scheme (ACGSF) Amendment Act 2019, the sharing ratio is Federal Ministry of Finance (60): Central Bank of Nigeria (40).

 

 

“The maximum for noncollaterized loan under the Agricultural Credit Guarantee Scheme (ACGSF) Amendment Act 2019 is now N100,000. Under the amended Act, the maximum amount for collaterized loan granted to individuals, cooperative societies and corporate entities is now N50 million, up from N10 million.

 

“Complete Agricultural Value Chain financing is now allowed under the Agricultural Credit Guarantee Scheme (ACGSF) Amendment Act 2019.

 

“The Agricultural Credit Guarantee Scheme (ACGSF) Amendment Act 2019 now also includes the financing of production farm machinery, the implementation and equipment for production, processing, storage and transportation.”

 

The ACGSF is a scheme managed by Central Bank of Nigeria (CBN). It provides guarantee cover to banks who give loan to the agricultural sector of the economy. This encourages the banks to provide more funding to the farmers.

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