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How CBN lifted 487 businesses with N407.36bn in 8 years

The Central Bank of Nigeria (CBN) has supported 487 business owners with N407 billion through its Commercial Agriculture Credit Scheme (CACS) between 2009 and 2016.

The agriculture credit scheme that was introduced in 2009 is a sub-component of the federal government Commercial Agriculture Development Programme (CADP) financed from the proceeds of the N200 billion seven-year bond raised by the Debt Management Office.

The CBN’s CACS evaluation and impact assessment report that was released on Wednesday disclosed that “Since inception till December 2016, the sum of N407.362 billion has been released to 487 projects (436 valued at N327.362 billion to private projects while 51 valued at N80.0 billion to State Government Projects).

“The total releases from the CACS Receivables Account remained at N199.831 billion while the total releases from the CACS repayment account stood at N207.531 billion.

“The cumulative fund repaid by banks into the Repayment Account stood at N225.009 billion in respect of 445 CACS projects out of which 109 projects had been fully repaid at end of December 2016.”

The reported noted that administration of structured questionnaires to beneficiaries with a retrieval of 191 from businesses that benefited from a total of N147.87 billion between 2009 and 2016.

“State governments also served as channels to specific groups of beneficiaries. Participating states were requested for details of groups and individuals that drew on the loan through them, and focused group discussions were scheduled in three of the states.

“Over the years, 2011 and 2015 recorded highest disbursements of CACS loans,” the report by CBN stated.

The report stated that most, 79.1 per cent, of the 191 businesses are private liability companies, 7.3 per cent were government owned, 6.8 per cent sole proprietorships and 4.2 per cent public liability companies.

On CACS loan utilization by beneficiaries, the report disclosed further that, “most (80.2 per cent) of the funds were applied to agriculture and agriculture related activities, by 82.7 per cent of the firms, while 19.8per cent (N29.2 billion) of the funds may have been applied in the areas not intended under the Scheme by 33 or 17.3per cent of the beneficiaries.”

The fund is made available to participating banks to finance commercial agricultural enterprises at a maximum interest rate of nine per cent.

“As hoped, 85.4 per cent of the firms undertook one form or the other of expansion in their operations on receipt of the CACS loan”, the report added.

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