11 Feb 2014 16:20pm
By Pearl Coetzee
WINDHOEK, 11 FEB (NAMPA) - Agribank is calling on farmers to make sure that they benefit from the drought relief measures put in place in October last year, because there are only seven weeks left before applications close.
The General Manager of the Agricultural Bank of Namibia (Agribank)s Lending Head Office, Shali Shindume told Nampa on Monday that the relief measures implemented by the bank end on 31 March 2014, and that deadline will not be extended.
The year 2013 was declared a drought year. The bank is committed to assist every farmer to overcome the challenges of the drought, and gave its clients the option to apply up to 31 March 2014 to benefit from these drought relief measures, he noted.
The bank introduced four drought relief measures in October last year. Two of these relief measures are facilities worth N.dollars 90 million, and include the production loan facility (N.dollars 75 million) and the water and infrastructure facility (N.dollars 25 million).
However, if the drought continues and weather experts also declare 2014 a drought year, the bank might reconsider the due date for applicants, Shindume added.
The production loan facility offers a reduced interest rate of four per cent for commercial farmers; and two per cent for communal and resettled farmers over a period of six years.
The water and infrastructure facility was offered to severely-affected farmers at an interest rate of four per cent for commercial farmers, and two per cent for communal and resettled farmers for a loan-term of 15 years.
However, clients in arrears as at 31 December 2012 should pay 25 per cent of their arrears upfront to qualify for both facilities.
The other two facilities were the ring-fencing of arrears and suspension of the penalty interest facility, as well as an instalment holiday period of one year. Clients of the ring-fencing of arrears and suspension of penalty interest facility received an amnesty period of five years in which the arrears would be ring- fenced.
Clients had to pay 25 per cent of their total arrear amount upfront, and the balance shall be ring-fenced for five years, to be paid in five instalments.
Shindume thus warned that the bank would take drastic steps against clients who default under the ring-fencing facility.
The most sought-after product by farmers so far was the instalment holiday period of one year, he said.
This product was an extension of any loan period to the farmer by an extra one year.
The banker furthermore called on clients who are in arrears to make arrangements with the bank, and to pay 25 per cent of their total debt.
The bank needs to implement its recovery strategy, and as a financial institution, needs funds to allow other Namibians to also benefit from these facilities.
Please come to the bank and apply. Farmers who did not receive rain so far should come and apply. Come and make use of this opportunity, he advised.
Namibia has experienced the worst drought in 30 years, which affected more than 700 000 people.
It has severely threatened the financial sustainability of producers in the agricultural industry.