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Agriculture is a vital sector of the economy in many countries, including emerging markets. Unfortunately, smallholder farmers in these markets face several challenges, including a lack of access to financing, basic inputs such as fertilizer and seeds, and training and knowledge on how to increase their yields. These challenges contribute to food insecurity in these areas.
Financial institutions can play a crucial role in improving the productivity and sustainability of agriculture by providing training, tailor-made financial services, and funding for long-term and green investments to support sustainable agriculture and agri-food value chains.
Equity Bank has recognized the importance of this sector and has made it a priority in their ‘Africa Recovery and Resilience Plan’. In the plan, productivity improvement in agriculture and reducing food losses are prioritized.
To respond to the prolonged drought situation in the region, Equity Bank has developed tailored solutions to assist farmers to invest in water harvesting, sinking of boreholes and establishment of climate-smart irrigation systems.
The Bank has also set aside funds to support farmers to invest in climate-smart agricultural activities such as the establishment of feedlots for livestock, zero and low tillage farming, among other solutions. Farmers can visit any of the bank’s branches to get more information on these solutions.
In addition, the Bank is supporting farmers, agrovets, agro-dealers to grow their businesses by providing access to loans to acquire farm inputs such as certified seeds, farm machinery, construct greenhouses, insurance solutions, water harvesting, and clean energy solutions.
The Bank also has a training program to equip farmers with knowledge and skills on how to run their farming business through financial literacy training and mentorship.
Equity Bank has impacted over 3.9 million farmers on productivity improvement and commercialization of agriculture. So far, 215,512 small and medium-sized farmers have benefited from loans amounting to Kes 73.28 billion over a period of 5 years and connected to value chains.
These investments are aimed at making agriculture more resilient and adaptive to climate change.
In the ‘Africa Recovery and Resilience Plan’, Equity aims to grow the Food & Agriculture loan portfolio to 30% of the total loan book underpinning the Group’s commitment to contributing to food security.
This growth will be achieved through capacity building of farmers to adopt sustainable farming practices and capacitating MSMEs and other value chain actors that populate agricultural value chains and ecosystems.
By partnering with financial institutions, farmers can access the capital they need to practice sustainable farming. Together, they can discover new possibilities that lead to a better understanding of what can be done to increase long-term viability and profitability in the agricultural sector.