EDAIF caution banks not to offer loans above 12.5 per cent

Dr Abdul-Nashiru Issahaku, Acting Chief Executive Officer of Export Development and Agricultural Investment Fund (EDAIF), has threatened that the Fund would review its relationship with any bank that offer the EDAIF loans above 12.5 per cent.

He said EDAIF offer the facilities to the banks at 2.5 percent, and they are expected to add a maximum of 10 per cent.

Dr Issahaku therefore urged clients of EDAIF who take the facility above 12.5 per cent to report the issue for necessary action.

The Acting Chief Executive was speaking at an EDAIF Regional Stakeholders Meeting and a media encounter in Koforidua on Friday.

EDAIF was established by an act of Parliament to offer financial support to individuals and groups engaging in agricultural production and processing for export at reduced interest rates through the banks, using the rural banking system.

Dr Issahaku said the Fund is working with the Regional offices of Ministry of Food and Agriculture and National Board for Small Scale Industries to represent the interest of EDAIF in the regions.

He however gave the assurance that the Fund is making frantic efforts to establish regional offices soon.

Professor Francis Dodoo, Chairman of the Board of Directors of the Fund, urged applicants of EDAIF to send copies of their applications to the Secretariat.

This, according to him, would prevent the situation where some banks intentionally delay submission of applications for the loan and take advantage of the delays to misinform clients to accept loans with an interest rate of 30 per cent.

He advised clients of the Fund who have challenges in applying for the facilities to report to the EDAIF secretariat to enable the fund managers consider the challenges when reviewing conditions of accessing the money.

Mr Gerald Nyarko Mensah, a member of the Board of Directors of the Fund, said EDAIF had offered a grant for the training of 800 vegetable growers in the Volta Region to learn improved ways of producing vegetables to meet the qualities of the export market.

The participants called for the simplification and standardisation of the application form so that the banks cannot take advantage of it and introduce charges which tend to increase the cost of accessing the Fund.

They also called for a review of the law establishing the Fund to enable it to directly deal with clients.