The Central Bank of Nigeria (CBN) has persuaded commercial banks operating in the country to increase their lending rate to the agricultural sector from four percent to 10 percent over the next four years.
Godwin Emefiele, governor of the apex bank, made the appeal on behalf of stakeholders in the agriculture sector while speaking at the 13th Annual Banking and Finance Conference organized by the Chartered Institute of Bankers (CIBN) in Abuja.
Emefiele, who bemoaned the dwindling income generated from the oil sector, noted that for the country to attain economic sustainability, it has become imperative to increase investments in non-oil sectors like agriculture that can enhance the resilience of the Nigerian economy in the face of external shocks.
“Over the next four years, the banking sector should consider ways it could increase its loans to the agricultural sector from 4% to 10% by 2024. With declining foreign exchange earnings from crude oil, banks should consider supporting agro-processing companies that are export-oriented,” he said.
Emefiele disclosed that the CBN is working towards improving access to loans through the use of information communication technology (ICT).
According to him, improving the use of ICT as an enabler for growth will help make for easier loan recovery processes.
The CBN governor also disclosed plans to establish an infrastructure company (Infra-Corp) to be led by the apex bank in partnership with the Africa Finance Corporation and the Nigerian Sovereign Investment Authority. He explained that the facility will enable the central bank to improve key sectors of the Nigerian economy, which includes the agricultural sector.