BoA Secures N550bn to Support Farmers, Stabilise Food Prices

The Federal Government has approved N550 billion for the Bank of Agriculture (BoA) to support smallholder farmers and implement a Guaranteed Minimum Price programme aimed at stabilising food prices. The funding includes N250 billion for financing smallholder farmers through technology-driven systems and N300 billion to enable the bank to buy produce during harvest and release it when needed to help control market prices.

Managing Director of the Bank of Agriculture, Ayotunde Sotinrin, said the bank finances farmers through aggregation companies such as AFEX, ThriveAgric and Arziki Noma rather than lending directly to individuals. He explained that the approach improves efficiency and reduces the risk of loan defaults.

Sotinrin disclosed that about 500,000 farmers have benefited under the pilot phase of the programme. He added that four per cent of the funding was set aside for insurance to protect the scheme against losses caused by weather-related events.

The BoA boss also said the bank has digitised its operations by introducing bank cards and digital wallets that allow farmers to receive fertiliser, seeds and other inputs, which can be redeemed at collection centres using Point-of-Sale terminals. He added that the bank now uses artificial intelligence through its Know Your Farmer system to automate payments and monitor transactions.

Sotinrin said the bank is also expanding support through ginger production, mechanisation and post-harvest services. He said the institution plans to deploy 2,000 tractors through service providers, introduce battery-powered cargo e-tricycles for produce transportation, and establish one-stop service hubs in farming communities as part of its transition to a technology-driven and sustainable financing model.