FARMERS ACCESS TO CREDIT

BY HAPPY MULOLANI Smallholder farmers have had challenges of access to credit and this has seen them stagnant in their agricultural activities. It is estimated that 80percent of smallholder farmers progression in their agricultural enterprises has remained very low. These challenges have basically been two fold, bordering on demand and supply. It is worth noting, that lack of collateral for accessing credit to enhance agricultural production has been one of the major factors that has been attributed to farmers not progressing in their enterprises as they are considered a high risk group. A dairy small-scale farmer in Choma, Farmer Noole expresses concern that there have been weak institutional framework, policy inconsistencies on agricultural financing as well as limited finance literacy. ‘’There is need for government to intervene in order to have farmers that are protected and ensure that farmers businesses are viable even as various linkage to prospective financiers become available,’’says Mr Noole. And Choma Dairy Association of Zambia Region Board Chairperson Mirriam Mbazima points out that the eminent problem of access to credit needs government’s and other stakeholders intervention. Mrs Mbazima also appealed to government to consider reducing the interest rates in order to ensure the cost of finance is lowered and increase demand as well as accessibility by producers. Against this background, government in collaboration with key stakeholders have made drastic strides in addressing farmers’ challenges. This has prompted the Ministry of Agriculture and other organisations such as SNV and AgriProFocus to jointly collaborate and run finance fairs in selected parts of the country. AgriProFocus Country Coordinator Claire Van Der Kleij pointed out that some of the institutions involved in the finance fairs include, Musika, Dairy Association of Zambia, Radio Café, Image Promotions and SNV Netherlands Development Organisation. Ms Kleij explained that the AgriProFocus, is a network of agriculture professionals initiated by Dutch Non-Governmental Organisations, finance agencies and knowledge institutes with the aim of promoting farmer entrepreneurship Ms Kleij disclosed that three finance fairs have so far been conducted, with the first fair being held in Choma and attracting over 500 farmers while in June, this year, another fair was conducted in Chipata and the third fair has reverted to Choma. AgriProFocus organises finance fairs in order to connect rural and smallholder farmers with finance service providers in a bid to empower them and also guide their own development as well as build their agribusinesses. These fairs also play a vital role in exposing and linking farmers to finance institutions, agri-businesses and NGOs as they exhibit their products and also interact during workshops that are also hosted while the fairs are in progress. This provides a platform to farmers share information about their programmes, products, investment opportunities, business planning and saving schemes. And SNV Sue Ellis says the organisation hosts AgriProFocus in Zambia and are an international not-for-profit development organisation. SNV will this year be celebrating its 50years of development work globally as well as its presence in Zambia, which is indicative of the massive work and support the organisation has rendered to rural communities and farmers . Dr Ellis says SNV works with local partners in order to equip communities, businesses and organisations with tools, knowledge and connections they need to increase their incomes and gain access to basic services, which will play a cardinal role in empowering rural communities in addressing poverty and for farmers to also guide their own development. ‘’On this basis, SNV partnered with AgriProFocus because we share the same goals and interventions in the agriculture sector,’’ pointed out Dr Ellis. And government has reaffirmed its commitment to support smallholder farmers engaged in agribusiness interventions in order to improve production and productivity. Agriculture and Livestock Deputy Minister Greyford Monde said currently, there were 400,000 smallholder farmers linked to agribusiness through outgrower schemes in cotton, sugar cane and soya beans Mr Monde explained that it was important to support various viable enterprises such as dairy, through investments that will help develop farmers’ business acumen. ‘’It is impressive that the district and overall, the province has a high presence of dairy farmers, which makes it a good investment for various dairy products,’’ says Mr.Monde. He added that despite 80 percent of farmers producing raw milk, the country was still a net importer of milk and milk products estimated at K25million kilogrammes of powdered milk. Mr. Monde said farmers should take value addition seriously if they are to gain more returns and profits from their dairy enterprise, noting that this applies to other enterprises as well. ‘’Value addition will help farmers gain more profits and returns on their products unlike in their raw form, and that’s is the more reason government was emphasizing on value addition,’’said Mr Monde. With the government and a consortium of agriculture development players helping to foster farmers’ accessibility to credit and other products through finance fairs, it is hoped that more farmers will take advantage of the opportunities that is now readily available. What is required is for farmers to be in organised groups and identify viable enterprises worth undertaking. It is crystal clear, that the availability of affordable credit is critical for the success of any sector of the economy, as credit will enable farmers to mobilise other resources to support production, employment and income generation within the sector.