This presentation discusses the Nigerian Bank of Agriculture and its role in economic development of Nigeria through agricultural finance.

1. THE BANK OF AGRICULTURE AND
ECONOMIC DIVERSIFICATION OF
NIGERIA:
Repositioning The Bank For Economic
Recovery
Terwase Swande, B.Sc, MBA

2. BANK OF AGRIC (BOA): Introduction
• Incorporated in 2010 and wholly owned by the
Federal Government of Nigeria
• Precursors are Nigerian Agric Bank (NAB)
(1972), Nigerian Agric Cooperative Bank
(1978), and Nigerian Agric Cooperative and
Rural Development Bank (merger of NACB,
Peoples Bank and FEAP in 2001)
• Performing under 30% of expected capacity
because of the spill over of numerous
problems militating against agric development
in the country.

3. Present State of Agric Sector in Nigeria
• Agric has taken a backseat to the petroleum
sector. So many problems militate against
agriculture although it is Nigeria’s largest
employer of labour with over 60% involved in
agric. Major problem is lack of working capital by
farmers.
• Sector seems unattractive to teeming youth
population and efforts like BOA are aimed at
stemming the tide and repositioning agriculture.
• Contributed 41.5% to GDP according to CBN
statistics. Agriculture may regain its past position
and serve as fulcrum for economic growth if
proper financing strategies are implemented.

4. Impediments to Agric and Agri-Business
 Poor Infrastructure
 Poor Policy Effectiveness
 Insecurity (North East)
 Lack of Credit Facilities to Farmers
 Low Access to Markets and Market Information
 Youth Rural-Urban Migration

5. Challenge BOA Must Face:
• Nigeria spends up to N1.3 Trillion importing Food
crops (Njoku, 1998).
• Agriculture accounted for over 70% of Nigeria’s foreign
trade in 1965
The Challenge for BOA:
BOA MUST INSTIGATE DEVELOPMENT IN THE SECTOR SO
AS TO MAKE AGRIC FLOURISH AND ACCOUNT FOR 70%
PERCENT OF FOREIGN TRADE DIRECTLY OR
INDIRECTLY.

6. BOA and Its Mandate...
Key Mandate of BOA is:
1. Provision of Credit facilities to support agric value
chain. And provision of micro credit to the poor.
2. Capacity development of cooperatives
3. Technical support and extension services
4. Boosting opportunities for self employment in rural
areas.
5. Inculcating banking habits in rural population and
grassroots (see website www.boanig.org )

7. BOA and Its Mandate...How Well has it Done?
SCORE= D [FAIR].
Why?
All Itemised list in Slide 6 has not been actualised up
to 40%. Most rural farmers who constitute more than
70% of the active labour force engaged in agriculture
do not know what is BOA and where it is.

8. Agric Financing in Other Countries:
Latvia, SA, Brazil, S/Korea and Ghana
• Comprehensive Agric Support that ensures
disbursement directly to farmers
• Involvement of MFBs and Community Banks to reach
Grassroots
• Lending heavily to industries that drive value chain eg
MIVA RICE, Tomato Factory, Soya Oil Mill etc
• Rural Youth and Persons with Disabilities
• Product paper for rural women
• Revolving financial Instruments just like “Bonds”
(APGs) in commercial banks are used
• Different treatment for different agric spaces

9. Agric Financing : Latvia, SA, Brazil,
S/Korea and Ghana...continued
• Heavy involvement of USAID, CIDA, AUSAID, The Bill
and Melinda Gates Foundation, IFAD, FAO, WorldBank,
DanishAid etc
• Massive Rural savings accounts
• Commodity referenced bonds for major farmers which
allows them to borrow on the promise to supply agric
produce in the future
• Fostering of non-bank informal agric lenders
• Very affordable modern implements like hand pushed
petrol driven ploughs and harrows and mowers and
tricycle pick up vans for light haulage

10. Mapping Core Strategies to Identified Issues:
The Way Forward
S/NO ISSUE STRATEGY
1 Market Info BOA should work multilateral aid agencies to
provide this service on a comprehensive scale
2 Poor
Infrastructure
MOUs with The Infrastructure Bank and FMBN for
rural mortgages and infrastructure
3 Access to Credit Develop a web based and mobile systems account
opening process to make it easy for farmers to
open accounts
4 Agri-business
drive
Flag off a special agric start-up NYSC scheme for
agric graduates to go into profitable arable and
pastoral farming. BOA can vet business plans and
disburse
5 Agric Innovation
in high schools
Involve IFAD, IITA and similar others to flag off
“schools farm project” with commercial viability

11. Mapping Core Strategies to Identified Issues:
The Way Forward
S/NO ISSUE STRATEGY
6 Venture
Philanthropy
BOA will provide moral suasion for states and
federal governments to support good farm projects
with venture capital as philanthropy or grants.
Involve NGOs specialised in agric funding
7 Workable
Partnerships
With states and local governments to resuscitates
farm hubs for extension services. Example: Ber
Agbum, NALDA in Shangev Tiev and Ikyogen all in
Benue State
8 “Helicopter
Money”
Outright free money to farmers
9 Recapitalizing
BOA
BOA can float agric bond to increase its capital. It
is listed as part of its mandate
10 Women
participation in
Agric
Flag off “green women” project and disburse N1
billion to 10,000 women (N100,000 each). N50
billion under this project will disburse N100k to
500,000 rural women.

12. Mapping Core Strategies to Identified Issues:
The Way Forward
S/NO ISSUE STRATEGY
11 Low Staff
Capacity
Partnerships with local and foreign universities and
development institutions for training of staff
12 Low outreach Partner with CBs, MFBs and Commercial Banks
and get BOA on payment systems and channel
services like ATM. Let people see it as a bank and
not some kind of government complex mysterious
bureaucracy. BOA can partner with LGs and
Telcos for information dissemination
13 Transformation
Programmes
Transpose good ideas from other countries

13. Conclusion
• Potential of Agric can be realised if BOA
performs its mandate very well
• Good outlook for Nigeria and BOA