USAID/LADA and Afriland First Bank (AFB) have signed a memorandum of understanding (MOU) to improve productivity through access to finance for organizations involved in agri-business. LADA (Liberia’s Agri-business Development Activity) strives to secure the nation’s food.
The MOU signed last Thursday in Monrovia by LADA’s Chief of Party Daniel Gies and Afriland First Bank’s CEO Hamadou O. Bayo defined the roles of both institutions.
The MOU provides the framework for Feed the Future (FTF), LADA and AFB to solve unfolding constraints to enable agri-businesses easy access to finance and more appropriate loan products.
Mr. Gies said the MOU is part of efforts by the two institutions to reduce the huge importation of food in the country with key focus on rice, cassava and other value chains.
Gies said access to finance remains one of the major challenges facing agri-businesses and farmers and makes it difficult for farmers to pay for agro-inputs or to repay embedded credits.
He said the purpose of the financial instrument is to work with farmers to improve the quality, quantity and marketing of locally-produced rice by importing up to US$2 million of processing equipment; unlocking financing opportunities for agro-dealers, processors and aggregators; and to ensure that these focused actors have access to investment credit and working capital.
“Afriland First Bank, as one of the most active agricultural lenders in Liberia, is an optimal partner for FTF/LADA because of high skills in lending to agriculture. We are proud to sign this Memorandum of Understanding (MOU) and will remain in effect until February 2019,” Mr. Bayo said.
He said the bank is a major Liberian commercial bank which focuses on Small and Medium Enterprises (SME) and agricultural lending to enable farmers improve productivity.
Mr. Bayo said the bank has some measures in place to monitor and evaluate farmers’ activities, including what they grow and how they add value to their produce.