The Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) has partnered with Credit Agricole Du Maroc (CAM) in Morocco to implement Agriculture-oriented projects in both countries.
Anne Ihugba, the Head of Corporate Communication of NIRSAL, revealed that a Memorandum of Understanding (MoU) was signed to seal the partnership.
This, according to Ihugba, will be accomplished by facilitating finance and investment, trade, and support systems across agricultural value chains, with a focus on smallholder farmers.
Investors King gathered that Mr Aliyu Abdulhameed, the Managing Director/CEO of NIRSAL Plc, and Mr Tariq Sijilmassi, Chairman of the Management Board of Credit Agricole Du Maroc (CAM), signed the MoU on behalf of their respective companies.
She stated that they were committed to mutual prospecting and implementation of agriculture-related projects that benefited both organizations and their host nations as a result of this MoU.
NIRSAL Plc’s areas of need, according to Abdulhameed, include the development of financing products that are tailored to the seasonality of agriculture and other farming contexts, as well as the challenges smallholders face in adhering to the requirements of traditional bank financing products.
Abdulhameed believes that agricultural financiers can profit greatly from innovative financing products that address the unique characteristics of agricultural primary production.
He said that it will assist financiers in maximizing the benefits and incentives offered by NIRSAL Plc’s 75% Credit Risk Guarantee (CRG) for primary production projects.
It will also enable conscientious borrowers to benefit from Interest Drawbacks (IDB) of up to 40%, he claims.
Commercial lenders in Nigeria have injected approximately N152.8 billion into the agriculture sector in the previous six years, he said, leveraging NIRSAL’s CRG facility, with credit crystallization rates remained around 1%, according to NIRSAL Plc.
The Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL Plc.) is a US$500 million non-bank financial institution that was established by the Central Bank of Nigeria (CBN) to redefine, dimension, measure, re-price, and share agribusiness-related credit risks in Nigeria.
NIRSAL was founded in 2013 in collaboration with the Federal Ministry of Agriculture and Rural Development (FMARD) and the Nigerian Bankers’ Committee with the mission of de-risking the agriculture and agribusiness finance value chain, fixing agricultural value chains, building long-term capacity, and institutionalizing incentives for agricultural lending through its five strategic pillars.