NRGP WOOS BANKS TO SUPPORT NORTHERN FARMERS
IN ORDER to empower rural farmers in the three Northern Regions, the Northern Rural Growth Programme (NRGP) is frantically collaborating with rural and community banks in the country to widen the scope of farmers' access to financial services.
At a consultative forum on the participation of Rural and Community Banks (RCBs) in the NRGP held in Bolgatanga, the National Director of the NRGP, Mr. Roy Ayariga regretted that the 'big banks' were shying away from agricultural financing -claiming high risks, unorganized farmer groups and high operational costs.
He said it was in recognition of these challenges that the government of Ghana took two loans each from the International Fund for Agricultural Development (IFAD) and the African Development Bank (AfDDB) to address these challenges and pave the way for robust agri-business to strive in the North.
Mr. Ayariga explained that the IFAD component of the loan was being applied to address issues such as access to finance by farmers, processors and marketers, along the value chain of production, processing/value addition and marketing till it gets to the final consumer.
He recalled that in the past, some banks financed these operations separately, however, the NRGP's approach was to analyse the value chain of the particular commodity, to identify the key challenges that must be addressed and the funding areas would then inform the bankers as to loan requirements at each stage till it reaches the final consumer.
According to Mr. Ayariga, if RCBs were to perform creditably, they would need the support of NRGP and that the programme has support in the area of training the bank staff, logistical support in terms of mobility and computers and funds for loan to finance the specific value chains being promoted
Having observed that availability of seeds was critical for expansion in the next cropping season, the Director said NRGP has commenced field operations beginning with dry season irrigated agriculture, adding that for this dry season, the programme was supporting Seed Growers Association to produce seeds of sorghum, soyabean, and maize.
He said the NRGP was also supporting high value vegetable production but the infrastructure base including cold-chain facilities were yet to be established to link vegetable farmers and buyers from the south. It is also supplying water pumps on three year loan, land preparation and production inputs including fertilizer and foundation seed.
Mr. Ayariga reiterated that until agriculture was seen as a business, farmers would not make much impact, and thus appealed to farmers, processors and other agri-business firms potential for financing or loaning in kind and with minimum cash at the farmer level.
He said loans were to promote business and farmers should only apply a percentage of their profits to social events and not divert cash for such events to organize funerals and festivals. While appealing to the banks to spend time in educating farmers before giving them loans, the Director also urged them to target more women for support as the were the better payers than men.
Some of the key challenges facing the northern farmer include adverse weather like drought and floods, land degradation resulting in poor soils, lack of investment resources, poor market access compounded by lack of information of what the market demanded.
The financial specialist of the NRGP, Mr. Emmanuel Antwi mentioned that four components of the programme as -infrastructural development, Value Chain Development, Improving Access to Rural Finance and Management and Coordination of the Programme.
He said improving access to rural finance was been financed by IFAD and the government of Ghana and it role was to facilitate the movement of fund and build the capacity of financial institutions so that they would be sustainable to give agricultural and credit service to the farmers.
He said the programme would strengthen institutional capability of the rural banks, train them and build their capacity, train them in appraising agricultural credits and diversify their portfolio to include agricultural credit.
The participants who were drawn from the various rural and community banks in the country pledged their readiness to cooperate with NRGP to offer financial services to the farmers but encouraged them to form groups or unions to facilitate their access to loan acquisitions.