The opportunities were there for farmers to diversify and grow their businesses through funding, said Stanbic’s Head of Agribusiness in Zambia, Mr. Leon Kotze. However, farmers needed to be able to show they had the ability “to measure and monitor the life cycles of their various commodities and the various strategies they could apply to ensure their businesses remained sustainable in the face of external shocks,” he said.

He was addressing farmers at the annual Agritech Expo at Chisamba.

He said the bank was ready to make use of funding opportunities in the farming sector. “It is also important that farmers look at their cash flows and gauge the right time to invest in the diversification of their businesses and to ensure that their crops don’t suffer under the debt load,” he said.

Kotze said despite various challenges in the sector, Stanbic had become the biggest agricultural financiers in Zambia, to the tune of US$200 million.

He said in recent years, under external pressures such as the drought, low power supply and the unstable currency more farmers defaulted on their loans (non performing loans averaged at 25%) after a point in 2013 where it went quite well, with non performing loans averaging at 10%.

He praised the agricultural sector for maturing significantly over the last 10 years, with above average production of major crops such as wheat, soybeans and maize.

He said the bank had also learnt a lot in the challenging environment. “As a bank we have navigated through this, relying on our agriculture lending policy, a proven approach to financing agriculture. We are conservative; we are consistent. We take a long-term view on investments that our customers make in the agriculture sector. Whenever we fund we make sure that our assumptions are based on very realistic long-term assumptions,” Mr Kotze said.

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