Maravi

(HERALD ZW) US$720m agric facility: Farmers court banks
October 19, 2013 silence muchemwa Headlines, Top Stories
Elita Chikwati Agriculture Reporter—

FARMERS have urged banks to relax their lending conditions so that they can access the US$720 million agriculture support facility availed for the 2013/14 summer cropping season. Banks are insisting on collateral and are not accepting 99-year leases and offer letters as security, prompting farmers to negotiate a relaxation of stringent collateral requirements.
Farmer unions have encouraged members to form groups to unlock funding.

Zimbabwe Farmers Union vice president Mr Abdul Nyathi said they were engaging banks on the issue.
“We are currently engaging banks on how best we can access the funding. We have come up with a plan of group lending and some banks have accepted the arrangement.”

Mr Nyathi said conditions set by banks were so stringent that few farmers would access the cash.
“For the past years, banks have been availing funds for agricultural support with only few farmers getting the money because of these measures. We are negotiating with the banks so we agree on terms of lending,” he said.

Zimbabwe Commercial Farmers Union vice president Mr Johnson Mapira said most farmers did not have the required collateral security.
“Some farmers do not have houses which can be used as collateral. Banks should consider other forms of property as security,” he said.
Other farmers suggested that banks should consider livestock and farm machinery such as tractors and implements as collateral.

Deputy Minister of Agriculture, Mechanisation and Irrigation Development responsible for crops, mechanisation and irrigation, Cde David Marapira said he would meet banks to map the way forward.

“I am going to have a meeting with the banking sector soon to see how we can assist farmers this season. Few farmers are accessing money from banks since the majority cannot meet the banks’ requirements,” he said.

Cde Marapira advised farmers to switch to contract farming.
He said contract farming was more viable than having to wait for the loans which may be accessible late into the season.

“There is a statutory instrument that guides contract farming. The regulatory framework states what every part should do to ensure a win-win situation.

“Contract farming is viable if handled well without the issue of side marketing,” he said.

Labels: LENDING RATES, NEW FARMERS

posted by MrK @ 4:34 PM