CBN Amends Agriculture Credit Scheme Guidelines

As part of efforts to sustain the public interest and enhance the operations of the Commercial Agriculture Credit Scheme (CACS), the Central Bank of Nigeria (CBN) has announced some amendments to CACS guidelines. Specifically, the central bank in a circular titled: “Amendments to Pricing of Commercial Agriculture Credit Scheme (CACS) and Guidelines,” addressed to all banks and other financial institutions, explained that the amendments affects Section 8.0 and 17.0 (b) (iv) of the guidelines. The circular, signed by the CBN Director, Financial Policy and Regulation Department, Kevin Amugo, was dated May 15, 2015.

“The CACS introduced in April 2010, has elicited tremendous interest from the Nigerian public. As part of efforts to sustain the public interest and enhance its operations to meet expectations, the Central Bank of Nigeria (CBN) has revised the CACS guidelines.

“Payment of interest on CACS facilities shall not exceed 9.0 per cent, inclusive of all charges. These charges shall be shared seven per cent to the participating bank and two per cent to the CBN. Section 8.0 sub-section (ii) of the CACS guidelines has been amended accordingly to reflect the revised interest rate ratio. The revised fee sharing formula shall take effect from the date of the revised guidelines.

“Funds shall be released to participating banks at two per cent interest rate after a confirmation of its intent/readiness to disburse the funds –Section 17.0 (b) (iv) of the extant revised guidelines. Participating banks and the banking public are enjoined to note that the revised guidelines dated April 29, 2015 supersedes the previous ones,” it added.

The central bank last year approved the extension of the terminal date of the CACS from September 30, 2016 to September 30, 2025. (Thisday)