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Agribank unveils lending facility for the unemployed

2021-11-05  Staff Reporter

Agribank unveils lending facility for the unemployed
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The Agricultural Bank of Namibia (Agribank) has confirmed a cash flow lending facility primarily targeted at the unemployed. 

This cash flow lending is an option under the Women and Youth loan scheme, which was developed with distinct requirements to benefit women, youth, and agricultural professionals. 

As a short-term loan, the cash flow lending facility requires no collateral for clients who do not have fixed properties or have limited collateral scope on their fixed properties. In addition, the special option was designed to address the barrier of limited access to finance due to lack of ownership of fixed properties to offer as collateral, especially among unemployed members of the community. 

Similarly, women and youth who have fixed properties are also faced with the barrier of limited collateral scope on their properties, hence experiencing difficulties accessing finance. 

Therefore, in addressing the above challenges, Agribank implemented the cash flow lending option under the Women and Youth loan scheme. Clients applying under this option are required to provide a valid off-take/ supply agreement based on their project’s cash flow projections. This agreement is a commitment between the farmer (the producer) and an off-taker (the buyer) whereby the farmer commits to supply the produce and the off-taker pledges to buy the produce from the farm. 

“To ensure that a buyer is legitimate, the bank conducts a due diligence check on the off-taker prior to loan approval. Once funding is approved, a tripartite agreement is signed between the client, Agribank and the buyer. Through the tripartite agreement, the buyer, when purchasing from the farmer, agrees to first pay the loan instalment amount to Agribank and then pay the difference to the farmer,” reads an Agribank statement. 

The public, particularly the target market of women, youth and agricultural professionals, interested and eager to start or expand their agricultural projects are encouraged to approach the bank for funding. 

“As a state-owned development finance institution, Agribank will continue to play a meaningful role in ensuring that both communal and commercial farmers have affordable access to financing, to transform the agricultural sector to optimum sustainable productive status for prosperity.”

2021-11-05  Staff Reporter

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