Monday, 5 December 2016

How to Obtain Agric Loan In Nigeria

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It is no longer news that the Central Bank of Nigeria (CBN) has approved the disbursement of about N75billion as loan to farmers in the 36 states and the Federal Capital Territory (FCT) under the Nigerian Incentive-Based Risk Sharing in Agricultural Lending (NIRSAL). But how this money reach the poor farmers that are in need of money to enhance their productivity is usually a problem

We will be looking at how to secure loan succesfully in Nigeria for Agriculture and what it takes to get such loans

The agricultural sector is noted as the highest employer of labor in West Africa, yet, it is not much more than peasant farming which could barely satisfy the needs of families. These reasons and more have propelled the Federal Government of Nigeria to start agricultural grants and credit initiatives. Through the Bank of Agriculture and some other commercial Banks 

These grants are suppose to cover many of aspects of farming:

Rice Farming: Undoubtedly the most imported and consumed food in Nigeria that leaves the question: When will Nigeria cultivate enough to stop depending on other countries for rice sustenance? The need to develop Nigeria’s rice farm culture is obvious and welcomed. It is among the farm products legible for loan.

Pig farm: On the other side of meats is pork emanating from pigs. Described as the better option, but the opportunity to setup a pig farm does not come cheap. So, it stands to be considered for loans.

Cassava: Serving as one of the most versatile farm products, cassava has been in the hem of agricultural products to be developed for extensive use in Nigeria. Biscuits, Bread, etc. It’s among the big products that the Federal Governments is urging investors to develop. And that means, your cassava farm proposal will be considered for loan.

Palm tree: Before 1934, Nigeria was the highest exporter of palm nuts, a product of palm tree. Today, Nigeria is making about 18% of palm products exportation. The chance to get back to where she used to be depends on the cultivating efforts of palm tree farmers. Nigerian government has been promising anyone who has interest in developing a palm tree farm loan.

There are so many other farm opportunities to be reckoned with. Whichever one you choose, follow the steps below to get the fund you need to cultivate it.


Poultry: one of the most lucrative businesses anyone could think of establishing, but it does not come easy. The process involves a huge capital which is the reason why it is in the list of farming that could be considered for Bank grants.

Union Bank of Nigeria

This Bank offers Agricultural financing to Agro-businesses, from small to big. But the starting point is: Evidence of ownership or right to use whatever portion of land you plan to use. Then you can choose from their Loan facilities what you really want-

Short Term Loan: Which covers a short period of time, say- 1 or 2 years.

Medium Term Loan: This type of Loan exceeds the period of 1 to 2 years. Sometimes, it lasts up to 4 years due to the technicalities involved in the business it is being funded with.

Long Term Loan: This type of loan is for Agric products that take longer time to mature.

Fixed Capital: Farmers get this type of Loan to enable them establish fixed assets on their farms.

Working capital Facility: This Loan is given to enable Farmers shoulder their day to responsibility in the farm.

Whatever your objective is, these facilities will enable you to achieve it, so far you meet up with these requirements-
Open an account with Union Bank
Submit a Loan application to the branch’s Business Development Manager
Pay 10% of the total fund you applied for
State the purpose of the Loan
Method of your farm production
Yields as expected
Your repayment plan

This setting is exclusive to individuals only. For Limited Liability companies and corporate organizations, there are only 2 steps-

Submit a loan application written with the company’s letter head to the Branch. It must be duly signed by the company’s representatives.

Submit detailed report on feasibility studies

There are other banks that offer credit facilities for farming in Nigeria, UBA, First Bank, Stanbic IBTC etc. Feel free to walk into any of the Banks and inquire of their procedure


Bank Of Agriculture


The Bank of Agriculture (BOA) was established to help farmers develop their fields to any extent possible by giving low interest loans to qualified applicants.

The process of borrowing from BOA is not rigid. BOA operates at a level of direct lending, on lending, collaboration, and credit monitoring.
Requirements For Loans

Loan Rate: Microcredit Agric and collaboration- 12%.

Loan condition: Lien deposits- 20%.

Customer account relationship- 6 months.

Deposit Rate: Interest Rate 2%.

A lot of other things are negotiable, but remember; your loan credibility depends much on the evidence that you have what it takes to execute your agricultural proposal. You can reach BOA on 07042262222, 07040202222.

Agric loan is not exclusive to BOA, other commercial Banks have been partnering with the FG to assist Farmers. 


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