Agriculture-focused financial institution, Agribank, has extended its farmland loan repayment period for youths by 5 years to 30 years.
Fillemon Nangonya, the bank’s spokesperson said all Namibians under 35 years of age willing to purchase farmland through Agribank, now have up to 30 years to repay their farmland loans.
“This represents a five-year extension from the usual 25-year period that is now only applicable to clients above 35 years of age. This change is prompted by the Bank’s financial inclusion agenda with a special focus on youth,” he said.
Nangonya noted that under the bank’s farmland purchase loan product, loans are advanced to purchase farmland or additional land for agriculture-related activities.
“This package is tailored for farmers seeking to ensure a well-developed and productive utilisation of the land, for food security and job creation,” he added.
The announcement by the bank comes after it started youth friendly terms and conditions aimed at encouraging young people to venture into farming.
“Over the past few years, Agribank has embarked on a youth inclusive journey providing youth friendly terms and conditions. In 2020, the pro-youth drive led to the introduction of the Women and Youth Loan Scheme (W&Y), targeted at youth (both men and women) of 35 years and below, women of all age categories, and agriprofessionals both full-time and part-time farmers,” he said.
Under the bank’s W&Y scheme, the target group is offered flexible collateral financing options, such as salary backed loans, whereby repayment can be through payroll deduction, contract financing and 100% loan-to-value collateral.
“Contract financing requires off-take agreement between the applicant and a potential buyer/offtaker at the time of loan application. Correspondingly, a tripartite agreement between the client, buyer, and Agribank is to be signed once the loan is granted. The recent product review exercise added a provision of a debit order for the W&Y scheme, applicable when the payroll deduction agreement between employers and Agribank is not in place and subject to client’s affordability,” Nangonya said.
In the past financial year, Agribank disbursed loans amounting to N$173 million to people and institutions in the agriculture sector with N$10.8 million disbursed to qualifying clients, specifically under the women and youth loan scheme.
Agribank is a State-Owned Enterprise mandated to promote growth and development of agriculture through affordable and innovative financing.
