The Central Bank of Nigeria Tuesday announced a non-interest credit facility for Nigerian youth with objective of engaging a minimum of 370,000 youths in agricultural production across the country over the next three years.
According the CBN, the Participating Finance Institutions (PFIs) will act as its agents in disbursing the financing to the beneficiaries, which shall be in kind.
The CBN in its statement highlighted that “the PFIs shall purchase the inputs for on-selling to the beneficiaries, using CBN approved non-interest financing contract of Murabaha, Istisna’, etc at an all-inclusive rate of return of 9% p.a.”
“For the financing of labour, the PFI shall use Service Ijarah or any other appropriate CBN approved contract for NIFIs with the same all-inclusive rate of return of 9%.
“Financing tenor is 6 months for grains and broiler production (rice, maize, soy bean etc); 18 months for cassava; 24 months for egg production and ruminants; 5 years for plantation crops etc
“Average financing size of N250,000 per ha for arable crops; N500,000 per unit for livestock; and N1.5 million naira for plantation crops like cocoa,cashew and oil palm.
The statement emphasized that the “beneficiary must be a Nigerian youth with the ages of 18 to 35 years and Sign an undertaking to abide by the terms of agreement of the Scheme.”