Two opposition heavyweights in the south-west of Nigeria are slugging it out for the leadership of the main opposition party, just as the region is threatened by clashes between local farmers and nomadic herders from the north.
Banks reach out to farmers
More greenbacks for greener revolutions
Read more analysis of how Africa’s banks are going the extra mile to get closer to their customers.
As they learn about farmers’ complex value chains and cash-flow problems, financiers are gaining confidence in their ability to influence decisions on what crops will be produced and when they will be sold. Standard Bank’s approach is to work with input suppliers so farmers can have access to quality seed, fertiliser and markets. “We want to move away from a product focus when we look at agriculture. It’s more solution-driven,” says Jacques Taylor, the bank’s head of agriculture. Instead of three- to five-year loans for commercial producers, Standard Bank makes 10-year loans. In Zambia, it is extending finance for winter crops before farmers have paid off their summer-crop loans.
New methods and new products are addressing the risks of lending money to farmers. In Kenya, Equity Bank and Co-operative Bank of Kenya have partnered with insurers on index-linked products for crops and livestock. “The banks want to protect their interests,” explains Isaac Magina, an agricultural underwriter from Nairobi-based UAP Insurers, which has 12,000 smallholder farmers signed up to its index-linked product. Once a farmer has a bit of paper saying that he is insured against loss of his harvest from drought or the death of his livestock, banks are more willing to lend and the farmer can invest more.