The European Union (EU), has injected EUR2.5 million into Ghana's agricultural sector to help increase farmers' access to credit facilities to finance their agricultural production and businesses in the agricultural value chain within the next six years.
The fund would be managed by the Sinapi Aba Savings & Loans (SASL), a non-banking financial institution providing loans and savings products to individuals and Micro-Small-Medium Enterprises (MSMEs) with a focus on rural areas and women.
Mrs Paulina Rozycka, the Head of the Infrastructure and Sustainable Development of the EU Delegation to Ghana, launched the initiative in Wa during a brief ceremony to hand over motorbikes to the Ministry of Food and Agriculture (MoFA).
She said the credit facility would provide access to finance to more farmers as part of the grand EU support in the agriculture sector under the EU Ghana Agricultural Programme (EU-GAP).
Mrs Rozycka observed that farmers and agricultural MSMEs were often excluded from the formal financing systems and had to deal with informal lenders or aggregators and having to bear higher interest rates.
“This line of credit will increase the number of smallholders (in the agricultural value chain) benefitting from loans and financial products by more than 25,000 borrowers.
More farmers will now benefit from small loans to finance agricultural inputs or equipment with technical assistance”, she explained.
Some farmers in the rural areas had complained of the high cost of farm inputs such as fertilizers and agrochemicals, which had affected their production abilities posing a risk of increased hunger and poverty to their families.
Madam Seozuma Saanuuri, a smallholder farmer at Yeliyiri, a community in the Wa West District, said women farmers in the community were hard-hit with financial constraints in financing their farming activities.
“We (women) are suffering a lot. This year we were not able to buy fertilizer for the farm. Getting a tractor too was difficult for us, so we did not get anything from our farms to feed our children.
“So, we would have been happy if the government or any organization could help us with loans during the farming season to farm and cater for our children”, she appealed.
The situation was not different in the Biskan community in the Wa East District, where farmers said due to the high cost of fertilizers this year, they had to divert from cultivating high fertilizer demanding crops like maize to producing soybeans that needed minimum fertilizer to yield.
Mr Seidu Abdullai, a farmer in the Biskan community, said the high cost of farm inputs and tractor services coupled with the lack of financial support to farmers was rendering the agricultural sector unattractive to the youth.
However, Mr Bob Zaato, Branch Manager for SASL in Wa, said the EUR2.5 million EU credit facility would help increase the value of loans given out to farmers as well as increase the number of farmers to have access to the loans.
“It has not been an essay task working with farmers; however, we are doing all that we can to serve them anytime they knock at our doors,” he said in an interview with the Ghana News Agency (GNA) in Wa.
Mr Zaato said any business or activity within the agricultural value chain was qualified to request financial support from his institution saying, “From today, any time you visit our branches you will be served.”