How To Get Agri Loans For Your Agribusiness

In today’s world of farming, farmers are experiencing more challenges than ever. To start with, climate change, soil degradation, inadequate water supply and land, and most importantly lack of funds to cater for all the expenses a farmer might need from production to marketing. This is why most able farmers haven’t successfully invested in farming be it, greenhouse farming, open field farming or any other type of agricultural practices. In this article, I’ll explore how to get agri loans for your agribusiness.

Why funding is important to farmers

With available opportunities to prepare controlled spaces for agrifarming, funds continue to be the major hindrance. Funding is the problem to the agricultural sector in Kenya and as a result we have inadequate equipment, lack of access to information for most farmers. 

There’s a lot loans can do to farmers

For instance, with available funds youth and old farmers can be able to:

  • Access land by either buying or renting land
  • Access training, education and skills 
  • Access to markets due to available budget for transport, packaging and prices of renting lorries to transport their products
  • Access to new farming technologies such as farm monitors, digital systems and new age greenhouses
  • Access to the right farm consultants 
  • Make land improvements and repairs
  • Cover operating costs  
  • Rebuild after a natural disaster 

 What is an Agricultural Loan (Agri Loans)?  

Agricultural diversification would involve purchasing more machinery, hiring more labour and increasing the amount of both labour and capital needed to manage a more complex operation. Without creating a financial reserve, there can be no loan structure, credit union or bank. 

Livestock, crops and poultry are make part of agribusinesses

Agri Loans are funds and loans farmers are given by institutions or individuals at low interests  to help them keep up with all the costs associated with their farms, stay afloat and run their farms more efficiently.  

Types of Agri Loans 

There are many types of Agri Loans. But I’ll just mention the major ones and here’s a list: 

  • Farm Operating Loans 
  • Farm Storage Facilities Loans
  • Farm Ownership Loans for purchase of land 
  • Dairy and livestock loan
  • Structured crop loan
  • Horticulture loan
  • Farm Development loan

Institutions offering Agri Loans 

Now that you’ve understood why you need the agri loans and the types, now let’s dive into how to get the agri loans for your business. Firstly, l’ll focus on local institutions and the global institutions. 

  1. Institutions in Kenya 

We have quite a number of Saccos, Banks and Loan Apps that can provide farmers with loans in horticultural production, asset loans and many others in this bank list. 

You access them in:

  • Government Programmes offering loans. Find the list here  
  • Commercial Bank of Africa (CBA)
  • Barclays Bank 
  • Chase Bank 
  • Co-operative Bank of Kenya
  • Kenya Commercial Bank
  • Kenya Women Finance Trust
  • Inuka Africa
  • Agri finance Corporation

You can access 33 institutions in Kenya here. 

  1. International Institutions 
  • International Finance Corporation 
  • European Investment Bank 
  • LAFCo, a Mauritius based investment company

Urge to farmers 

The agriculture sector has a crucial role to play in the long-term development of most African countries. For many African countries, agriculture remains the most important source of employment, income and overall well-being. 

There’s a need for agri loans and funds firms to constantly reach out to farmers and keep the sector growing. Farmers shouldn’t feel insecure with the agri loans firms for fear of ‘their businesses being taken over.’ The main goal should be ensuring constant production and supply of  healthy food to the world population and accruing their return-on-investment. 

The Bottom Line 

It’s never too late to try out either of the agri loans mentioned above. You can also search for more in your respective country. Hope the provided institutions will help you get agri loans for your business. 

Nevertheless, agri loans will not end hunger challenges or make farming affordable for everyone  but it will make life for farmers easier. 

Leave a Comment