Cassava seed producers have raised concerns over their inability to access loans and insurance cover to hedge against risks.
They spoke at the second edition of the cassava seed business summit organized by the Building an Economically Sustainable and Integrated Cassava Seed System, Phase 2 (BASICS-II) project of the International Institute of Tropical Agriculture (IITA).
Mr. Charles Adeniji, President of the Industrial Cassava Stakeholders Association of Nigeria (ICSAN), noted that even though the Central Bank of Nigeria, commercial banks, and microfinance banks have funding programs, they are usually burdened by administrative and process challenges that make access difficult.
His words: “Generally, financing is available with the Central Bank of Nigeria. The commercial banks and microfinance banks have intervention funds. But there are barriers to access, high-interest rates, short tenure, and often strident conditions.”
According to Dr. Augusta Amajuoyi, the Vice President of the National Association of Cassava Seed Entrepreneurs Network (NACSEN), poor access to loans was a major challenge for a private sector-led cassava seed system.
“Seed entrepreneurs find it difficult to get loans because of the harsh conditions given by banks requesting collateral and all manner of things. Sometimes, interest rates are up to 28%,” she lamented.
The Summit themed: “Financing and Insurance Opportunities for the Sustainable Growth of the Cassava Seed System”, was held virtually recently, with over 130 cassava entrepreneurs and stakeholders in attendance.
The Summit featured two-panel sessions. The first session addressed “The Business of Cassava Stem Production: Emerging Activities of Cassava Seed Entrepreneurs, and Challenges Affecting the Sustainability of the Cassava Seed System”, and the second session focused on “Exploring Financing Opportunities for Seed Entrepreneurs in the Cassava Value Chain.”
Stakeholders underscored the importance of financing and insurance for cassava seed ventures and charged government and finance institutions to address the funding bottlenecks.
In his welcome remarks, Temitope Adegoroye, Managing Partner at Sahel Consulting, the summit convener and one of the implementing partners of BASICS-II, stated that finance and insurance were crucial for sustainable growth in the cassava seed system. He called for continuous collaboration of stakeholders in the sector to specifically support and explore financing and insurance opportunities for seed producers within the value chain.
“A sustainable cassava seed system would catalyze the potential of cassava given the country’s status as the highest producer of the crop in the world,” he said.
In the keynote address, the Permanent Secretary of the Federal Ministry of Agriculture and Rural Development (FMARD), Mr Ernest Umakhihe, encouraged seed enterprises to make insurance covers part of their business strategies.
Mrs Sugra Mahmood, Deputy Director Irrigation, Federal Department of Agriculture, who represented the Permanent Secretary, stressed the need for awareness creation on the business prospects of cassava seed multiplication and the importance of partnerships and collaboration to support the growth of a sustainable cassava seed system.
Mr Ayodele Olaleye, Head, Agriculture Insurance, Veritas Kapital; Mr Olushola Obikanye, Group Head of Agriculture, Sterling Bank; and Mr. Stephen Magige, Country Manager of Mennonite Economic Development Associates (MEDA) Tanzania, spoke on the various financing and insurance opportunities available to stakeholders in the cassava value chain. They emphasized the importance of enhancing farmers’ access to finance and insurance services.
Dr. Godwin Asumugha, Acting Executive Director, National Root Crops Research Institute (NRCRI), Umudike, Prof Lateef Sanni, IITA BASICS-II Project Manager, and Mr Paul Enecko, Zonal Manager of Mennonite Economic Development Associates (MEDA) in Tanzania, explained the steps being taken to develop the cassava seed system in Nigeria and Tanzania. Sir. Francis Chia, President of the National Association of Cassava Seed Entrepreneurs Network (NACSEN) stated that the creation of associations for cassava seed entrepreneurs, capacity building, and promoting access to high-quality planting materials, were key to growth in the cassava seed system.
In his closing remarks, Dr. Phillip Ojo, Director General, National Agricultural Seeds Council (NASC) expressed optimism about the catalyzed growth of the cassava value chain. He solicited the continuous collaboration of stakeholders towards a robust and vibrant seed system