Challenges of Accessing Agric_business Finance in Nigeria

Agricultural sector is one of the important sectors that serves as economic backbone upon which the Nigeria government rely for its foreign exchange and revenue. Agricultural sector comprises of farming, fishing, pastoral, hunting etc. We have the challenges of accessing agric_business finance in Nigeria.

cocoa plantation

Some of our Agricultural produce include, Crops, vegetables, hides and skin, milk, meat and fish. Most of which are cultivated using mechanized farming, as such ,we get surplus to export to other countries.

In a developing country like Nigeria, the contributions of Agriculture is considerable. It serves as foreign exchange, employment, source of food and income etc.
Agriculture finance can be seen as resources which can come from the public or private sector, it can be in form of loan, gift or even equity that aids the social welfare of agricultural sector. It involves both the public and private sectors like the NGO’s with the sole aim of promoting agricultural development, empowerment, income equality and all these will in turn lead to community development.
Some of the Agric_business finance that is obtainable include;
1. Non_debt (Non_leverage)
The funds here do not imposed fixed or mandatory servicing obligations to the individual or group seeking for it.
2 Debt (Leverage)
There is need to pledge resources or assets as collateral,  it has fixed contractual finance obligations. You are expected to pay back based on agreed terms
Sources of Agric_ business Finance in Nigeria
1. Federal Government of Nigeria
Government support to Agriculture in Nigeria comes in form of leverage, it must be payed back.This method serves as major form of financial support to farmers in Nigeria. Example is the recent one been managed by the office of the Vice President of Nigeria, Prof Yemi Osibanjo through the Nigeria Incentive_ Based Sharing System for Agriculture Lending (NIRSAL). This has been of immense help to farmers in the Country. Farmers in the country are happy.
2.Financial Institutions e.g Bank
They give funds to farmers in form of debts. The require collateral and other things.
3. Private Sectors
Some private sectors, individuals at times do come to the aid of farmers based on agreement. With the sole aim of feeding the nation.
4. Development Partner funding
The comprises of Government and Non governmental Organizations otherwise known as NGO’s, example Food and Agricultural organization. African Development Bank, Bank of Agriculture, Bank of Industry. These agencies are set up for the purpose of providing scarce resources, empowerment, capital and aids in poverty alleviations.
Problem Accessing Agricultural Finance
High interest rate
Most Agric business finds it difficult to access loans due to the interest rate. At times the gain the will make from their produce won’t be enough to offset the interest of their loans.
Requirements for loans
At times it is difficult to access loans due to the requirements, example getting references letters , guarantors, as people are scared of standing in for people, another issue with loan is with collateral, a lot of farmers don’t have assets that will be good enough to use and pledge as collateral. These has a negative effect on them.
To access funds at times, busy farmers are required to come for trainings in form of seminars before accessing funds. Farmers may find it difficult to abandon their farms. As the trainings takes weeks and sometimes months , busy farmers don’t have such time
Untimely approval
Loans at times takes time to access, sometimes it may be out of planting season before the loan will be ready, as such it won’t be useful to the farmer season.
Foreign exchange losses 
This affects both goods ready for export and some agricultural equipment that is needed for farming
There is need to alleviate the challenges facing farmers in Nigeria, it can be achieved by sharing of profit and loss between farmers and institutions providing funds.
Reduction in interest rate to farmers is recommended and farmers should be given preferential treatment when asking for loans with consideration that farming or most sectors of agriculture is season bound.
In other to improve the financial ability of farmers, the issue of collateral should put into consideration.
Once the needs of Nigeria farmers are taken care of, with our available natural resources and fertile lands, not too long, Nigeria will be known as the Food basket of the World.
What do you think of some of these challenges of accessing agric_business finance in Nigeria.