CBN Inaugurates Board to Boost Agricultural Financing

 

The Central Bank of Nigeria (CBN) has inaugurated a new board for the Agricultural Credit Guarantee Scheme Fund (ACGSF), in a move aimed at revitalising financing for the nation’s agricultural sector.

Governor Olayemi Cardoso described the inauguration as “a new dawn” for agricultural finance in Nigeria, stressing that the sector can no longer rely on “business-as-usual” funding if the country is to achieve food security and sustainable economic growth.

“Agriculture contributes over 20 percent of our GDP and employs nearly two-thirds of our working population, yet it receives less than five percent of bank lending,” Cardoso said. “This persistent financing gap has constrained the potential of millions of Nigerian farmers.”

Established in 1977, the ACGSF encourages banks to lend to farmers by guaranteeing up to 75 percent of agricultural loans. The CBN governor, however, noted that evolving challenges such as climate risks, insecurity, complex value chains, and the rise of agritech demand that the scheme adapt to current realities.

Under the amended 2019 Act, the fund’s share capital was increased from N3 billion to N50 billion. Cardoso said the strengthened scheme must now move beyond guaranteeing loans to actively providing affordable credit to farmers, cooperatives, and agribusinesses.

The CBN chief urged the board to prioritise financial inclusion, particularly for smallholder farmers, women, and youth, who face the greatest barriers to credit. He called for partnerships with microfinance banks, cooperatives, and fintechs to design suitable loan products.

“Digital solutions such as group lending, agent banking, and mobile credit platforms should be leveraged to ensure that lack of collateral or location is no longer a barrier to financing,” Cardoso said.

To ensure accountability and minimise loan defaults, he recommended real-time oversight using satellite imagery, digital dashboards, and data-driven monitoring. “Every naira guaranteed must translate to tangible value on the farm and in the marketplace,” he said.

Cardoso added that smallholder farmers, who account for 80 percent of producers, remain the backbone of Nigeria’s food production. He urged the board to reposition the ACGSF as the cornerstone of the country’s agricultural transformation.

“With this inauguration, we renew our commitment to a prosperous, food-secure Nigeria. The task is daunting, but our determination is stronger,” the CBN governor concluded.