- The plan is to enhance fertilizer access by farmers hence boosting food production
- A fertilizer distributor can borrow up to of Sh20 million
Co-operative Bank of Kenya has signed a Sh500 million financing deal with agro-supplies firm Yara East Africa to facilitate fertilizer distributors across the country purchase and restock their outlets.
The five - year Agro-Distributor Finance partnership launched Tuesday will see Sh62 million being released immediately to the Yara fertilizer distributors who have already applied for the scheme.
The overall goal of the Agro-Distributor Finance Scheme is to enhance fertilizer access by farmers hence boosting the much-needed food production in the country.
Speaking at the signing ceremony, Yara Country manager for Kenya, William Ng’eno, said the financing program will enable farmers to access the various Yara fertilizer brands with ease and in turn boost fertilizer use to increase soil fertility, promoting increased food production.
''This project will enable distributors to increase their stock, to meet the high demand for fertilizer during this short rain planting season and beyond,’’ Ng’eno said.
He added that Yara will give a three per cent discount to distributors making purchases under this Co-operative Bank Distributor Finance scheme to ensure fertilizers are readily available and accessible to the farmers for planting and top-dressing purposes
Co-op Bank’s acting director Corporate and Institutional Banking, Jacquelyne Waithaka, said it was important to provide financial support to input distributors if the country is keen at realizing its agenda on food production.
Agriculture is the cornerstone of Kenya’s economy, with the sector accounting for 33 per cent of the country’s Gross Domestic Product (GDP).
“The Agro-Distributor Finance Scheme will help distributors and agro-dealers of Yara fertilizers to thrive in the dynamic business environment. The distributors can borrow up to a maximum of Sh20 Million to finance purchase of their fertilizer stocks from Yara East Africa,’’ Waithaka said.
The distributors will enjoy negotiated banking terms, with a disbursement fee of two per cent being the only charge.
“In addition, an overdraft with an expiry period of 180 days (6 months) and payment upon utilization of the overdraft will be due within 45 days,” Waithaka said.