TADB, KCBL eye small scale farmers in Sh2bn-loan deal
Moshi District Commissioner Said Mtanda (centre) displays a document during a signing ceremony between Tanzania Agricultural Development Bank (TADB) and Kilimanjaro Cooperative Bank Ltd (KCBL)From left is the Chairperson of Kilimanjaro Native Cooperative Union, Cosmas Mushi, TADB Managing Director Frank Nyabundege, KCBL General Manager, Godfrey Ng’urah, and Kilimanjaro Cooperative Officer, Godbless Munuo. PHOTO|THE CITIZEN CORRESPONDENT
What you need to know:
- The loans would be issued against affordable interest rates under the SmallHolder Farmers Credit Guarantee Scheme under a broader initiative by TADB
Moshi. Tanzania Agricultural Development Bank and the Kilimanjaro Cooperative Bank Limited (KCBL) have inked a deal that will see them loaning a total of Sh2 billion to smallholder farmers in Kilimanjaro Region.
The loans – to be issued against affordable rates under the the SmallHolder Farmers Credit Guarantee Scheme (SCGS) – are part of a broader initiative that seeks to revolutionise farming, livestock keeping and fisheries.
Under the arrangement, TADB will be issuing guarantees for farmers who will be getting affordable loans from KCBL to undertake farming, livestock keeping and fisheries activities.
TADB is coordinating the guarantee under the SCGS.
Speaking during the event, TADB managing director Frank Nyabundege said the arrangement was part of the bank’s initiatives in ensuring that farmers access loans at affordable interest rates.
“Being a development financing institution, we have seen the need to partner with KCBL in empowering northern zone farmers with low-interest loans,” he said.
He said the affordable loans initiative was meant to entice commercial banks so they could raise the value of loans they give to farmers, farmers’ groups and their cooperative societies.
This is geared towards creating an enabling environment for the growth of the agricultural value chain across farming, livestock keeping and fisheries in the country.
“As for cooperatives, TADB had disbursed a total of Sh117 billion in loans to the sector as of September, 2021 under the same arrangement. What we are doing here today with KCBL is basically continuation of the work that we have been doing,” he said.
Witnessing the signing ceremony, Moshi District Commissioner Said Mtanda commended the parties, calling upon Kilimanjaro residents to make use of the opportunities that would come out of the two lenders’ partnership.
KCBL general manager Godfrey Ng’urah exuded confidence that the loans to be issued under the arrangement will boost agricultural productivities in Kilimanjaro Region, including facilitating the availability of farm inputs and tractors among others.
Farmers in Kilimanjaro Region will get loans of up to Sh50 million per individuals and Sh500 million for farmers’ groups and up to Sh1 billion to companies whose activities have direct impact on small scale farmers.
Data, produced at the event by Mr Nyabundege showed that so far, since its establishment in 2018, the SCGS has guaranteed a total of Sh106 billion in loans to some 11,785 direct beneficiaries and 750,000 indirect ones.
“The money has gone to supporting production for cashew nuts, rice, coffee, sugarcane, cassava, cotton and poultry,” he said.
During the past three years of the existence of the SCGS, TADB has worked with NMB Bank, CRDB Bank, Azania Bank, Tanzania Commercial Bank, Stanbic, FINCA Microfinance, UCHUMI Commercial Bank, Tandahimba Community Bank, Mufindi Community Bank, Absa, NBC Bank, Maendeleo Bank and now the Kilimanjaro Co-operative Bank Limited (KCBL).
