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  If you are a farmer or an agribusiness entrepreneur in Nigeria, you can get a loan to finance your business from the Bank of Agriculture.
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The Bank of Agriculture (BOA) is a development finance institution set up to stimulate the growth and progress of Nigeria’s agricultural sector, by providing financial services to businesses operating in the sector. It was incorporated in 1972 as the Nigerian Agricultural Bank (NAB). Its mandate has changed multiple times over the years. In 2010, it was rebranded, and assumed its current name (the Bank of Agriculture), as part of a broader move to transform the institution.

What The Bank of Agriculture Does

The BOA exists to perform these functions:
  • Provide credit for businesses across the agricultural value chain
  • Provide microcredit to non-agricultural concerns
  • Promote agricultural cooperatives, develop information systems, and provide technical support and extension services to farmers
  • Enable banking in rural communities, especially those involved in agricultural activity

Bank of Agriculture Loans

The BOA agric loans include credit for input procurement, mechanization, storage component, agro-processing, haulage, and export. Besides these, there are specific loan programs, which include: Sugar Revival Credit Facility: The BOA finances businesses across the sugar value chain, in line with the Nigerian Sugar Master Plan, and in collaboration with the National Sugar Development Council (NSDC). Ranching Development Credit Facility: Loans are provided to cattle farmers to enable them to set up and operate ranches. This program aims to tackle the incessant clashes between herders and farmers. Hides and Skin Revival Facility: This credit facility is designed to revive the production of hides and skin, a line of agribusiness that boomed prior to the discovery of crude oil, and receded as the petroleum industry became a more important segment of the Nigerian economy. Cooperative Family Feeding Program (CFFP): Under this program, foodstuffs from cooperative producers are supplied directly to families to reduce product prices. Equipment Leasing Product (ELP): Agriculturists are provided with the equipment they need to produce at the highest levels of efficiency possible. Youth Agricultural Revolution Nigeria (YARN): This loan is targeted at young people who are engaged in agriculture. The maximum loan amount is ₦1 million. It’s granted to both individuals and groups. The interest loan for the YARN loan is 12% per annum. Grow And Earn More (GEM): The maximum amount for this loan is ₦1 million. Applicants don’t need to have collateral. In the place of collateral, the BOA requests suitably qualified guarantors. The annual interest rate for the GEM is 12%. The BOA also provides micro-credits for non-agricultural purposes. The maximum loan amount receivable under this program is ₦250,000.

Eligibility For A Bank Of Agriculture Loan

The BOA grants credit to both small and large-scale agribusinesses. Applicants, if they are businesses, should be registered with the Corporate Affairs Commission (CAC).
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They may also need to have an account with the BOA. They can open one at a BOA office closest to them. The bank has branches across Nigeria.

Bank Of Agriculture Loan Requirements

If you would like to apply for a loan from the BOA, you will need to have the following documents:
  • Company profile
  • Business plan
  • Completed application form
  • Bank statement
  • Cash flow budget
  • Financial accounts (audited)
  • Tax clearance certificate
  • Certificate of Incorporation (from the CAC)
  • Valid ID (voter’s card, driver’s license, international passport)
  • Details of collateral (if needed)
  • Proof of address

How To Apply For A BOA Loan

Visit a branch of the BOA closest to you. The bank has multiple branches in all six geopolitical zones. Be certain about the type of loan you’re applying for (check the segment ‘Bank of Agriculture Loans’ above). If you’re not, you may ask officials at the bank for help. When this is clear, you may fill and submit an application form, along with the other documents required (see the segment ‘Bank of Agriculture Loan Requirements’). After applying at the BOA, the institution will assess your application. If your application succeeds, you will be issued with a pre-approval letter, which details the terms and conditions for the loan. If you meet those conditions, your loan request will be fully approved. The loan tenor typically doesn’t last more than five years. Interest rates are often between 12% and 14% per annum.

Final Words

There are several funding opportunities for agribusinesses. The Bank of Agriculture’s credit program is one of them. If you have a properly defined, properly ordered business in the agricultural space, you may succeed at securing a loan from them. Featured Image Source: Make Money NG
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This article was first published on 14th July 2021

ikenna-nwachukwu

Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.

Comments (1)

One thought on “How To Get A Loan From The Bank Of Agriculture”

  • Oluwaseun Adeniyi

    This is really informative and please how do I get a good business plan for my agric biz coz I’m into cassava, palm oil and maize cultivation

    Reply

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