The increase in the country’s population and the call for higher-value agricultural production gave the need to invest in agriculture. Also, the constant demand for food and change in dietary preferences of citizens turned the agricultural market as the most sorted for.
There are several ways you can apply for a loan in Kenya, but in this article, we will explore some of this government agricultural loan programmes in Kenya. However, before we go into that, let’s take a quick look at what agricultural loans are..
What are Agricultural Loans?
Agricultural loans are a type of loans designed or mapped out for farmers and Agribusinesses. The loans are used by farmers and Agribusinesses in ways like farming, farm implement purchases, crops for cultivation, and other agriculture-associated activities.
What are Government Programmes for Agricultural Loans
Government programmes for agricultural loans are a set of related measures or activities or schemes with a peculiar long-term aim of giving loans to farmers. The program is set up by the government intending to support farmers and Agribusinesses in food production.
The programme caters for all Agro-entrepreneur who are ready to work and boost the economy through mechanized agriculture.
List of Government Programmes for Agricultural Loans in Kenya
1. Agricultural Finance Corporation: Agribusiness Loan
They set this programme up to support and encourage beginners in the agricultural sector. They design it to provide capitals for Agribusiness traders and start-ups.
2. Youth Enterprise Development Fund
The Youth Enterprise Development Fund helps in the provision of mechanized tools to farmers. They have partnered with agencies like smart solutions in Africa (SSA) to support young farmers and beginners in accessing greenhouses and mechanized implements.
Their aim is to provide a shift from traditional farming methods to the modernized methods.
3. Uwezo Fund
They established it in 2013 geared towards mentoring entrepreneurs which young farmers are inclusive towards eradicating poverty. They off loans between the range of sh. 50,000 and a maximum of sh. 500,000.
It is mainly for youths, women, and people with disabilities. They are also known as Mirroring the youth fund. They also help in achieving gender equality and self-independent.
4. Women’s Enterprise Fund
Women’s enterprise fund is an initiative tied to offering women entrepreneurs loans to start up something and be self independent.
They also help in marketing goods and services produced by these women entrepreneurs. It is a social motivation fund by the government to women entrepreneurs.
contacts: +254 0714606845-6
The Industrial and Commercial Development Corporation is a 64-year-old initiative. Moreso, ICDC offers capital, joint-ventures, commercial loans and asset financing to entrepreneurs.
The aim of ICDC is to boost agriculture and industrial development in Kenya. They also offer medium and long-term loans.
Email: email@example.com, firstname.lastname@example.org
6. Kenya Industrial Estate.
They joined Kenya Industrial Estate to the Ministry of Industrialization to boost the economy. Boosting all aspects of industry, both Agriculture is the key to reaching developed status.
Hence, Kenya industrial Estate is driven to indigenize all sectors of industry in Kenya. They provide subsidized loans and improved entrepreneurial skills to the citizens. They also offer loans of up to 14 million shillings.
Email: email@example.com Contacts: +254 0722 297 636/+254 0733 279 861
7. Industrial Development Bank
First Industrial development banks help to establish or expand the business and younger farmers. Their loans come in different forms ranging from projects, assets to tools financing and hire purchase.
They established it in 1973 and disburses secured loans to large industrial enterprises like Agribusinesses. They are capital heavy venture initiatives.
Email: firstname.lastname@example.org Mobile: +254 0733 221 111; 0728 970 750
Pros and cons to government programmes for agricultural loans in Kenya
- Low interest rates
- Opportunity to attend seminars and lectures by the organizing officers of the programme
- Enough fund to achieve your aim
- Longer repayment duration
- Constant advice and briefing on the current situation in agricultural sector
- Lack of access to modern instruments of risk management like insurance
- When farmers don’t meet with demand, nobody cares. You must fulfill the contract agreement
- Might not see a guarantor to stand for you.
How to apply on each of these government programmes agricultural loan
The steps in applying for any of these programmes are:
- Visit their website online and or their physical location
- Fill the application forms online or download the form and fill it.
- Take the filled form to their office
- Submit all necessary documents and details
- E-Sign if it is available online or meet the loan officer to share necessary information on how to start your loan process.
- Click enter if it is online. When it is offline, submit all necessary documents and wait for approval and disbursement.
Who is eligible for Government programmes for agricultural loans in Kenya
The programme is for all kinds of farmers such as small and marginal farmers, tenant farmers and entrepreneurs in agricultural sectors or business. Concisely they include:
- Farmers who are more than 18years and above and possess a national ID and active phone number
- Entrepreneurs in the agricultural sector.
General required documents for government programmes for agricultural loans
The general documents required include:
- National ID
- Proposed business plan
- Bank account statement
Note: Each programme has peculiar additional documents they require.
How to be part of the government programmes for agricultural loans in Kenya
To be part of these programmes and also benefit from it, you need to be:
- Be a farmer or a young entrepreneur in the agricultural sector.
- Start a Horticultural projects
- Establishment of dairy units and be ready to feed the country.
- Establishment of small poultry units and need a working capital for expansion.
Note: There are other criteria included. Contact the program organizers or visit their head office to get more clarifications.
Importance of government programmes for agricultural loans in Kenya
The importance of these programmes are:
- The programme plays a key catalytic role in strengthening the farm business
- It helps in augmenting the productivity of scarce resources.
- Bridges the gap between macro and micro agricultural systems.
Having food reach every nook and crannies of Kenta is the concern of government and agriculturists. Also, the government being aware of the need of agriculture amongst other sectors of the economy, they consented to improve agriculture by venturing into government programmes. These programmes give loans to both farmers and Agribusinesses.