The National President of the All Farmers Association of Nigeria, Kabir Kebram, has described the Central Bank of Nigeria’s Anchor Borrowers’ Programme as a failed intervention.
Speaking on the controversial agricultural financing scheme, Kebram said AFAN had distanced itself from the programme from the onset after evaluating its sustainability and structure.
“As AFAN, we did not participate in the programme because our initial analysis showed us that the scheme was going to fail. It was not going to work,” he said.
Launched in 2015 by the CBN under former Governor Godwin Emefiele, the ABP was introduced to provide smallholder farmers with access to credit and inputs to boost local production, particularly of staple crops such as rice, maize, and cotton. The programme was a major pillar in Nigeria’s push for agricultural self-sufficiency.
Over the years, the ABP has recorded some success, but the AFAN president insisted that many farmers did not benefit from the scheme. According to CBN data, more than four million farmers benefited across 21 agricultural commodities.
Rice production in Nigeria reportedly increased from five million metric tonnes to about eight million tonnes within six years, while rice importation dropped by nearly 50 per cent. Additionally, the number of mega rice mills in the country grew to around 50.
Despite these gains, Kebram argued that the structural weaknesses and lack of proper oversight rendered the programme ineffective in the long term.
“I have said it time and again that the CBN is not continuing with this. There is no development finance because of the money that was used there. They have disbanded it,” he stated.
Kebram also referenced the legal troubles of former CBN Governor Godwin Emefiele, linking them directly to the mismanagement of funds under the scheme.
“Emefiele was in jail because of this and still has problems because of the money that was used there,” he added.
There have been a number of serious challenges, including diversion of funds, input misallocation, and high-level political interference. As of 2023, about N1tn had been disbursed through the ABP, but only approximately 40 per cent of the loans had been recovered, leaving a massive repayment gap.
With a default rate of about 60 per cent, the programme had failed in its core objective of creating a sustainable and accountable funding system for Nigeria’s farmers.
Emefiele had stated that the programme was a shift from pure monetary policy toward directly catalysing growth in key sectors, especially agriculture, to create jobs, raise local output, and conserve foreign exchange.
ABP was designed to link smallholder farmers to larger buyers or processors and to channel bank credit into farming. Its stated goals included creating an ecosystem that connects producers with markets, increasing commercial bank lending to agriculture, boosting capacity utilization in agri-business, raising farmers’ productivity and incomes, and reducing rural poverty.
The Anchor Borrowers’ Programme guidelines stipulate that upon harvest, benefiting farmers are to repay their loans with produce (which must cover the loan principal and interest) to an anchor, who pays the cash equivalent to the farmer’s account.
The scheme provides in-kind and cash loans for inputs (seed, fertilizer, etc.) through participating banks. Small farmers join organized groups under an Anchor, typically a large processor, commodity association, or state programme, which guarantees an off-take market for their crops.
The Anchor linked the farmers to a bank, and the bank applies to the CBN for financing after due diligence. Borrowers were expected to repay the loans in harvest produce (covering principal and interest) to their Anchor, which in turn remits the cash equivalent to the bank.
However, the CBN, under its current Governor Yemi Cardoso, has stopped all intervention programmes, including the Anchor Borrowers’ Programme, due to the many concerns raised about the various schemes.
