MINAGRI Commits to Addressing Loan Challenges for Farmers and Livestock Breeders

By Elias Hakizimana.

During the closing ceremony of the 17th Agriculture and Livestock Show, farmers and livestock breeders raised significant concerns about the challenges they face in securing loans for agricultural and livestock activities.

In response, the Ministry of Agriculture and Animal Resources (MINAGRI) assured them that concrete measures are being taken to address these issues.

The Agriculture and Livestock Show, held over ten days at Mulindi in Kigali, concluded on Friday, August 9, 2024. This year’s event marked the 17th edition and showcased a wide range of innovations in the agriculture and livestock sectors.

Stakeholders expressed satisfaction with the progress made, but highlighted persistent obstacles posed by financial institutions.

These institutions often either deny loans to the agriculture and livestock sectors or impose prohibitively high-interest rates, currently standing at 18%. This has discouraged many farmers and breeders from seeking financial support.

 

Jean Claude Shirimpumpu, President of the Rwanda Pig Farmers’ Federation and head of agriculture and livestock at the Private Sector Federation (PSF), voiced his concerns.

“The interest rate on loans for agriculture and livestock is still excessively high, and banks continue to view these sectors as risky. We need to educate our banking partners and advocate for the creation of a specialized agricultural and livestock bank, a need we have been voicing for some time.” Shirimpumu said.

These concerns were echoed by other farmers who have faced similar difficulties when trying to secure loans.

Egide Tuyishimire, a farmer from Kirehe District who also processes avocado and chili products, shared his frustrations:

“Recently, I approached a financial institution for a loan of less than a million Rwandan francs, but despite having a confirmed market, I was turned down. This setback occurred even though I have a long-standing relationship with the bank.” He said.

Marie Angelique Mujawayezu, an agricultural entrepreneur who focuses on cultivating fruit trees, particularly avocados, added: “We are being charged 18% interest, but in agriculture, there are times when crops fail, leading to losses. We urgently need advocacy to reduce the interest rate to at least 5%.”

Farmers and breeders alike are calling on MINAGRI to take decisive action to make loans more accessible and to lower the interest rates.

In his address, Minister of Agriculture and Animal Resources Dr. Ildephonse Musafiri reassured the stakeholders that the Ministry is actively working with financial institutions to increase the availability of loans for the agriculture and livestock sectors and to reduce interest rates.

“We are committed to ensuring that loans become more accessible while interest rates decrease, ideally to around 10% or 9%, through partnerships with banks that collaborate with the CDAT fund. Our advocacy efforts are ongoing, and we are confident they will bear fruit because we are in agreement with the banks. When you came to showcase your products, you saw the presence of institutions like BK and Equity. They are beginning to recognize the potential within agriculture. Regarding the establishment of a specialized agricultural bank, we already have numerous private banks in Rwanda, and if the private sector is interested in creating one, we will fully support it,” Dr. Musafiri stated.

The 17th Agriculture and Livestock Show (Rwanda Agri-show 2024) attracted 420 exhibitors and saw an average of 4,000 visitors per day. Minister Musafiri emphasized that MINAGRI’s top priority is to ensure food security across Rwanda.

Participants at the show reported that the event was highly beneficial, allowing them to sell their products and connect with potential buyers.

Ikijumba One Stop Shop Representative receiving the award as the best in Agro-processing industry.  Rwanda’s Traditional Intore performing during the ceremony. 

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