Mr Hayatudeen Awudu Ibrahim, the Garu branch Manager of BESSFA Rural Bank in the Upper East Region, has said farmers under the Warehouse Receipt System (WRS) will be given loans by Rural Banks, at a low-interest rate, this year to enhance productivity.
“Farmers need the financial support to expand their farms and increase productivity to speed up the growth of agri-business in the Garu and Tempane Districts of the Upper East Region”.
The Warehouse Receipt System is a document of a title given to farmers after storing their grains in a certified warehouse.
The farmers are then able to present the receipt as collateral to secure financial assistance from the WRS partner banks.
Speaking in an interview with the Ghana News Agency, Mr Ibrahim reiterated the commitment of rural banks to support farmers, saying discussions were underway by the players in the banking industry, notably the Ghana Commodity Exchange (GCE) and APEX Bank, to embrace the WRS and improve the earnings of farmers.
He said farmers in the past found it challenging to take loans from the banks and other financial institutions to expand their businesses due to the risks involved in farming, erratic rainfall, post-harvest loses and poor markets, that affected production.
“However, the Warehouse Receipt System (WRS), where post-harvest losses and marketing of farm produce was to be improved, the anxiety and uncertainties of farmers will be reduced thereby giving them the courage to borrow from the banks to improve their work”.
He said all was set to start after harvest, November –December this year and the loans would attract a low-interest rate to cushion farmers until they sell their farm produce.
“The loans to be given are highly protected in terms of collateral as all the documents prepared will include the interest and the terms accepted by both parties, that is the bank and the client so the bank can exercise the option of disposal even if the farmer is reluctant to do so”.
He advised farmers to form groups and take advantage of the opportunities that would be made available to them saying no farmer who has enough produce in a warehouse would be denied a loan.
Mr Maxwell Akandem, the Chief Executive Officer of Akandem Farms at Sandema, Builsa North District, who also spoke with the GNA indicated that the move to support farmers with a sustainable financing scheme was a good strategy that would enhance farmers’ productivity.