Nationwide discontent grows over NIRSAL’s agric loan handling

By Moses Obajemu

• Executives accused of bias, overbearing influence
• Adesina, Sanusi well-conceived project being mismanaged

The allegations of preferential treatment and bias against the Nigerian Incentive-Based Risk Sharing System for Agriculture Lending (NIRSAL) by some southern farmers in respect of prompt disbursement of CBN-approved loans are not abating or going away any time soon.

Various farmer organisations, particularly in the south west, have accused NIRSAL of working at cross purposes with their objectives by frustrating them from accessing agricultural loans disbursed through the organisation.

Hope Concept Investment Cooperatives and Credit Union, which took on the company last year over undue prevarication in disbursing the N324 million which the CBN approved for its members, had to resort to open protest in Lagos last year and threatened to claim damages in lost opportunities before some semblance of order could be restored. Even after NIRSAL’s seeming readiness for a rapprochement and readiness for a truce, the farmers still remain to be compensated by NIRSAL.

Another group, Niji Group, with the latest complaint, said even when Bank of Industry (BoI) approved a loan for First City Monumental Bank (FCBM), for the Tractor Owners and Operators Association of Nigeria (TOOAN) to acquire the tractors after meeting all the  conditions, the Nigerian Incentive-Based Risk System for Agricultural Lending (NIRSAL), declined to guarantee the loan.

Kolawaole Adeniji, a farmer and managing director of the group, lamented his ordeal and other farmers who could not access the BOI loans because of NIRSAL’s arrogation of power to itself. He explained: “That was when we went to the Africa-French Development Bank for support to guarantee what NIRSAL could not guarantee after four months of TOOAN paying for the loan they didn’t actually receive.‘’NIRSAL declined the transaction they were supposed to support for no reasons, knowing full well that this group is well organised and it is on ground.

“What will make NIRSAL not to guarantee a good transaction that will develop agriculture in Nigeria, that we have to wait for another four months to search for another country to come and guarantee? That means the money that was supposed to go into Nigerians’ pocket  actually went out. This means we are not ready for agribusiness.’’ Elesa Bitrus Yakubu,  an engineer and TOOAN national president,, said the acquisition of the tractors would go down in the history of TOOAN; that it approached the bank for a loan to finance 50 units of tractors, negotiated, met the loan conditions and secured the nod for the N500 million without intervention from the government or any intermediary.

He, however, lauded BoI for considering TOOAN credit-worthy. He also lauded FCMB and Africa-French Development (AFD) Bank for their support and for agreeing to manage the loan repayment and provide a guarantee. “We are grateful to FCMB and AFD for trusting us to repay the loan. This gesture is a golden opportunity, considering  that NIRSAL, the Federal Government agency that is supposed to provide the Credit Risk Guarantee (CRG), declined to consider our request, despite our appeals to grant us audience to discuss further on the CRG-ADB’s partnership,’’ Elesa added.

Akin Agboola, president of Hope Concept cooperative, had said last year that the cooperative met the conditions stipulated by the CBN for accessing the loan. This was corroborated by an informed CBN insider who would not like his name mentioned. According to Agboola, “the first thing the CBN required from us was that we have to be a minimum of 250 farmers. Then, there must be a farmland that could be mechanised, which we have already… Another requirement is that members must have five per cent equity. We met all the conditions.”

It was revealed, however, that after NIRSAL verification of all of the requirements, the CBN approved the loan and paid NIRSAL on July 19, 2018 for onward payment to members of the cooperative, but the money was warehoused by NIRSAL for no tenable and just cause. The anchor and off taker, Flour Mills Plc, had to back out of the deal because of the delay caused by NIRSAL. According to Agboola, Flour Mills took the decision because NIRSAL decided to cut down the prices of the inputs to be used by the farmers which the CBN, NIRSAL and the farmers had earlier agreed upon. Flour Mills was to supply the input. But NIRSAL began to change the rules, which frustrated the farmers and hindered them from going to farm, thereby losing the opportunity to produce before the end of 2018.

In addition to complaints from the South-West farmers, a group of farmers’ cooperative in Imo State complained in December 2018 about the shoddy treatment they received in the hands of NIRSAL on loans that NIRSAL was supposed to guarantee. A fortnight ago, during a seed stakeholders’ meeting in Abuja, the managing director of Kojoli Farms from Jada in Adamawa State, accused NIRSAL of frustrating their business partners’ loan expectation and even surmised that the agency was allowing sharp practices.