KENYA – In efforts to improve national food security, Faulu Microfinance Bank has allocated KES1.5 billion (US$11.46 million) to finance farmers’ purchases of farm and livestock inputs.
The credit facility aimed at 47 counties is expected to help boost food security efforts by increasing production capacity.
The timing of the credit facility’s launch couldn’t be timelier as it coincides with the rainy season when most farming activity takes place.
Faulu Microfinance Bank’s CEO Apollo Njoroge stated that the institution intends to provide farmers with a low-interest, bullet- or moratorium-repayable loans for agricultural purposes.
“This will align with various seasons of livestock and crop farming, and will also support farmers to access affordable and flexible financing and insurance solutions,” said Njoroge.
Besides crop farmers, the bank can provide loans to livestock farmers to purchase livestock, animal feeds, and the construction of animal structures.
A second area of interest for the Bank is providing insurance for agricultural products.
“We as a bank seek to enhance agriculture-led economic growth, improve nutrition outcomes, strengthen county government capacity, increase resilience, and build sustainable market systems by supporting farmers to access affordable and flexible financing and insurance solutions,” he said.
The agricultural sector in Kenya accounts for roughly 33% of GDP, as reported by the UN’s Food and Agriculture Organisation FAO in recent years (GDP).
In addition, more than 40% of the total population and 70% of the rural population are employed in the sector.
Smallholder farmers and agricultural enterprises however continue to face difficulties expanding their businesses and improving the quality of agricultural goods, which has led to a stagnation in agricultural productivity in recent years.
Njoroge however believes that for the Kenyan economy to function optimally the country should experience food security.
“This is because, having secure access to food can produce wide-ranging positive impacts, including economic growth, job creation and poverty reduction,” he points out.
This year will be a pivotal one for Faulu as she works toward her goal of becoming her customers’ most trusted lifetime partner and a true advocate in their pursuit of financial independence.
This is the case even as it delivers on its promise of meeting its monetary requirements through a compelling value proposition.
