South Africa’s Land Bank wants to provide R1 billion worth of finance to black entrepreneurs in the 2018 financial year to invest in predetermined agricultural products like fruit and nuts.
CEO TP Nchocho said the bank also wants to invest R500 million in specific food and agricultural processing industries which support black industrialists.
These contributions are part of about R3 billion that the bank intends to award to the agricultural sector through financing in the 2018 financial year.
At a media information session, Nchocho said the banks’ strategy for development financing is aimed at growing the sector on an inclusive basis. Africanfarming.com earlier this year reported on the R1.3 billion that the World Bank awarded to Land Bank, which will form part of resources for the planned growth in financing.
SUPPORTED 700 NEW FARMERS
Nhcocho said the bank supported more than 700 emerging farmers through cooperation agreements with agricultural partners.
The wholesale financing product that the bank uses to finance the loans, more than doubled during the past financial year (until 31 March 2017), from R389 million to R849 million.
The bank plans to finalise an alliance for the financing of irrigation infrastructure for upcoming farmers on 30 000 ha in Limpopo, Kwa-Zulu Natal and the Eastern Cape.
According to Nchocho the bank wants to help emerging farmers financially and with technical support to become commercial.
He also wants to contribute to helping women, the youth, farm workers and rural communities, as they are increasingly meaningful participants in the sector.
Nchocho said the bank wants to support established farmers with financing and advice so they will undertake capital investments, modernise their farming operations and grow their enterprises.
The bank also wants to increase its support to sectors which show potential for big growth and wants to double its exposure to horticulture.
According to Nchocho the biggest challenges the bank has to face are poor economic growth, the cost of capital, the ability of the bank to provide technical or industrial experience, insufficient synergy with government’s utilities programs and the lack of young people and women involved in their programs.
