Agribank announced N$104.6 million in instalment relief and N$83 million in waived penalty interest as part of interventions to provide relief to its clients impacted by the effects of the drought.
The decision by the agriculture-focused bank, which is expected to benefit 1,134 out of its 2,634 clients, comes after Minister of Finance and Public Enterprises Iipumbu Shiimi in his budget speech in February 2024 had announced the interventions.
“The drought relief will be implemented effective today (10 July 2024), and it will be in the form of an instalment relief and a penalty interest waiver for clients. We are facing challenging times for both our clients and the bank. We want both to survive, and we are trying to balance many considerations to ensure our clients receive some scope to make it through this difficult period,” Agribank Chief Executive Officer Raphael Karuaihe said on Wednesday.
Conversely, the bank revealed it is grappling with N$1.2 billion in outstanding client debts.
The subsidies are divided into two interventions, instalment relief to Agribank clients and waiving penalty interest.
“There are two interventions to curb the effect drought has on agricultural clients: the instalment relief and a penalty interest waiver for clients. Based on the criteria agreed with the Ministry of Finance and Public Enterprises, this intervention of instalment relief is limited to Agribank clients with farmland and livestock loan accounts,” Karuaihe said.
He further highlighted that clients who landed in arrears in the financial period of 1 April 2023 and 31 March 2024 will be eligible for the instalment relief intervention.
“Clients who fell into arrears between 1 April 2023 and 31 March 2024 will also be considered,” he noted.
Qualifying clients will receive full payments for their instalments on time, and overdue accounts will be settled immediately.
“Accounts of qualifying clients will be credited in full as and when instalments fall due, and past-due accounts will be credited with immediate effect. The total commitment for this intervention is N$104.6 million,” he noted.
Moreover, the second intervention for Agribank clients that meet the subsidy loan requirement notes the cancellation of penalty interest amounts on overdue accounts for the financial period of April 2024-March 2025.
“As a gesture of goodwill, Agribank offers to waive penalty interest amounting to approximately N$83 million for this financial year (April 2024-March 2025) for all our clients that are in arrears,” he said.
