The Central Bank of Nigeria has unveiled its new policy towards Non-Interest Financial Institutions (NIFIs) for agro-industries as well as micro, small and medium-sized enterprises. This new scheme should also benefit start-ups as well as companies that want to develop or are weakened.
Among the 10 guidelines is the Accelerated Agricultural Development Scheme (AADS).
The Central Bank will also create a Fund, AGSMEIS Non-Interest Fund, which will be domiciled in a dedicated account. Concretely, each interest-free deposit bank (whether a bank as such or a branch in a bank) will have to contribute 5% of its profits before taxation to this Fund. This contribution must be transferred to the Fund no later than 10 working days following its annual general meeting.
The activities eligible under this scheme will cover the entire agricultural value chain, be it production, inputs, storage, processing, logistics and marketing.
According to the Bank, this should benefit 370,000 young people aged 18 to 35 who want to start farming by 2023.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer