President William Ruto, on Wednesday, August 2, announced that his administration laid out a comprehensive plan to ensure farmers access affordable credit facilities.
Speaking at State House, Nairobi, during a press briefing on subsidised fertiliser, the Head of State revealed that farmers can now take loans through the Warehouse Receipt System Council (WRSC) and Agriculture Finance Corporation (AFC).
The loans will borrow the model of the Hustler Fund, which offers interest rates below 10 per cent to incentivise low-income earners to grow cash crops.
“We will implement the Warehouse Receipt System Act, 2019, which establishes a structured and well-regulated trading system for agricultural commodities.
“This system creates an ecosystem with opportunities for the private sector and NCPB to provide a trading platform that links buyers and sellers, and facilitates access to credit by agricultural producers,” the President announced of the first loan facility.
The Warehouse Receipt System Act 2019 provides a legal framework for developing and regulating a warehouse receipt system and council for agricultural commodities.
A council established under the act is mandated to purchase agricultural items, borrow loans and avail funds, invest and sign contracts.
Farmers across the country will also apply for loans through Agriculture Finance Corporation (AFC) to boost their agricultural production.
In that line, Ruto revealed that he would increase AFC's budget from Ksh2 billion to Ksh10 billion to facilitate affordable credit to farmers.
“The credit will be provided at single-digit rates to further reduce our cost of production and enhance productivity,” the President assured.
How to apply for the loans
According to the Warehouse Receipt System Council (WRSC), farmers will use crops they have stored as collateral to access loans at the National Cereals and Produce Board.
Once implemented, the loan facility is estimated to benefit over 3.5 million farmers, most of whom are small-scale entrepreneurs.
Farmers interested in the loan facility must submit applications in written form or hard copies or submit a soft copy to info@wrsc.go.ke.
On June 30, Ruto appointed Felicity Nkirote Biriri as the chairperson of the Warehouse Receipt System Council for a term of three years as he set out to secure his legacy.
The Agriculture Finance Corporation, conversely, offers eight different loans to farmers. Unlike WRSC, it also offers credit facilities to livestock farmers.
Loans available under AFC include; Machinery, Agribusiness, Livestock and Fisheries Development and Cash Crop loans.
Others are; a Horticulture and Floriculture Development Loan, Water Development Loan, Seasonal Crop Credit and School Based Loan.
Farmers can view the different loans on offer and their specific requirements on www.agrifinance.org.
