Onyeka Akumah, the Co-Founder and Chief Executive Officer of Farmcrowdy; Yomi Jemibewon, Co-Founder of CardinalStone; Olu Wole, Deputy Director, Development Finance Department of the Central Bank of Nigeria, and Thomas Essel, Secretary General of African Rural and Agricultural Credit Association , based in Kenya, spoke at the recent Agricultural Summit hosted by Sterling Bank PLC in Abuja, on what small-holder farmers can do to make themselves commercially attractive for funding and investment.
We supply 50 cows to the top eateries in the country on a daily basis, apart from Sundays. We have raised N2.5 million chickens to the eateries. We have cultivated 16,000 acres of farmland within the period. We started with small scale farmers. We said we were going to work one to one with each farmer. That was a big mistake.In the first couple of months, it was a lot of work coordinating 500 farmers scattered all over the place.
One of the easiest things that the individual farmer can do is to plug themselves into those systems of cooperatives and groups, to allow themselves reduced exposure to deal with the risks at individual levels and do so collectively in a group. We started focusing on signing up cooperatives in different locations.
Our technical experts were able to effectively coordinate their efforts in one community as against going to different touch points. We are excited about working with all the farmers. This is the approach we intend to take going forward. Working with the cooperatives helped us put the farmers at check. The banks like working with cooperatives than individuals.
The entrepreneur needs to find the right model before scaling. One needs to find what works for him and streamline his operations before scaling. We knew that there were a few starch and flour producing companies across Nigeria. But, we had a supply issue. So, we decided to review our strategy and start from the farm. We went and acquired largescale farmland and started doing our own farming.
One of the biggest impediments to lending by the banks is the ecosystem. It is not any individual player’s fault. The whole ecosystem has to evolve together for things to work. So, that long term vision of the small holder farmer is very important. To be able to say: it is us not me, I will give up less value for myself.
When we get to a certain scale and want to get the next scale, suppliers that served us today might not be sufficient for us at that new scale. The distributors might not be sufficient. We have developed the value chain to cater for the small-holder, largescale, processor using the different channels of financing.
Under the CBN small-holder scheme, there is the Anchor Borrower Programme. The small holder farmers come together as a cooperative. They must open an account in the name of the cooperative. They must have their BVN. In a nutshell, it is a cycle, and the money will always come back. So, if you satisfy all the condition, one will be attractive to investors and financiers.PT: How do we ensure regional integration of small-holder farmers in Africa?: It is clear Central Banks, which have the regulatory responsibility of monitoring what is happening, are becoming more stringent in their supervision.
So, the farmer has a business model that is clear and has a strategy, then he needs also to convince. Brand the little thing one is doing, no matter how small.