Agri-financing hits 4.55tri/- as sector sees major boost

DODOMA: AGRICULTURE financing in the country has continued to improve over the past four years, with loans injected into the sector rising from 2.8tri/- to a whopping 4.55tri/-, according to the latest data.

Various initiatives, including the introduction of a 1tri/- stimulus package, taken since President Samia Suluhu Hassan assumed office, have significantly lowered the interest rates on agricultural loans from around 20 percent to as low as single digits.

This was revealed yesterday at the Nanenane exhibition grounds in Nzuguni Ward, Dodoma, when the Permanent Secretary of the Ministry of Agriculture, Mr Gerald Mweli, received a dummy cheque of 400m/- from the Tanzania Agricultural Development Bank (TADB) Managing Director, Mr Frank Nyabundege, as sponsorship for the Nanenane exhibition.

After receiving the cheque, the Permanent Secretary announced the bank as this year’s main sponsor of the event, which is being held nationally in the capital city, with the government-owned financial institution, established to provide long-term loan solutions in the agricultural sector, marking a decade since its founding.

“We are celebrating 10 years since this bank which specialized in agricultural development was established. Below five years under President Samia leadership, we have since this Bank growing in terms of capital and expanding by reaching more farmers and all traders in the sector’s value chain,” Mr Mweli noted.

Regarding the exhibitions, the Permanent Secretary told reporters that this year’s event is not only a platform for showcasing products, but also a centre for providing useful information to all stakeholders in the sector, which employs approximately 70 percent of Tanzanians.
The growth of the agriculture sector, he added, cannot be separated from the financial sector, stating, “Farmers are well-secured when there are reliable buyers of their produce, and TADB has been empowering both buyers and partners.”

Also read: TADB disburses 38bn/- to boost dairy sector

Over the past decade, the PS explained, the bank has issued loans that have enabled farmers to acquire technologies, including, but not limited to, tractors and agricultural inputs. He emphasized that Tanzania cannot speak of the sector’s achievements without acknowledging TADB’s contributions.

On his part, TADB Managing Director Frank Nyabundege said the bank decided to participate in the exhibitions as the main sponsor as a way of giving back to the government, following its support that enabled the institution to graduate into a major bank in the country with capital exceeding 1tri/-.

For a bank to be classified as a major financial institution in the country, its capital must not fall below 1tri/-, according to the Bank of Tanzania (BoT), the lender of last resort.

He noted that over the past four years, the bank’s capital stood at only 60bn/-.

However, President Samia, with her commitment to transforming the sector, increased TADB’s capital by 442bn/-, empowering the financial institution to extend more loans to the agricultural sector.