By Ndafadza Madanha

AGRIBANK says it is prepared to waiver stringent requirements to access loans for youths in agriculture and its value chains provided concretized and specific off take agreements are in place.

Youths have cried foul over inability to access loans from banking institutions as collateral in the form of immovable property is often required.

However, Agribank senior economist Joseph Mverecha who spoke at the Federation of Young Farmers Club Zimbabwe (FYFCZ) meeting said youths need to be supported but banks had an obligation to safeguard deposits and comply with regulatory lending requirements.

He said it was equally important to attract young people into agriculture as the country is yet to fully exploit the potential of the youth as the average age of a farmer in Zimbabwe is 55 years and life expectancy averages between 55-60 years.

Among Zimbabwean youths farming is largely unattractive owing to perception of agriculture as a career of last resort, one of drudgery and low monetary benefits.

Also information on access to markets, factors of production including land and financing remain extremely limited hindering adequate engagement of youth in agriculture.

“In the last eight years the bank was making huge loses and about 50 percent of our loan book was to agriculture and the sector was constituted the bulk of non-performing loans.

So we had to undertake a turnaround strategy and in it we incorporated a turnaround strategy for agriculture. In that strategy we came up with the need for concrete and stylized off take agreements that do not require security and are acceptable to the regulator.

We need off takers that make specific commitments to take produce from young farmers. We are not married to collateral as the end all but we need specific and concrete off take agreements and once that’s in place we shall support young people in agriculture and its value chains”.

Already Agribank is assisting a number of young farmers who include Aaron Denenga who is the reigning young farmer of the year.

Denenga said his relationship with Agribank was a template that could be used by other financial institutions to support young farmers and urged his peers to maintain sound financial records in all their business operations.

“My relationship with Agribank is a template for supporting youths in the country, I didn’t have security but my financial records bore testimony of my ability and because of that I got a loan from Agribank. I started with 5 hectares of tobacco and today I’m now at 60 hectares,” said Denenga.

FYFCZ president Tinashe Jena also urged financial institutions to take a leaf from Agribank and come up with models that support youths in business.

“Collateral is a major issue for young farmers and we urge financial institutions to keep brainstorming for models that by pass collateral. We also need them to consider issue of long term capital for infrastructure and mechanization”.

The ministry of Lands, Agriculture and Rural Resettlement has established the Youth Desk in order to empower the youth.
The ministry believes youth participation in agriculture offer a dynamic workforce that is innovative, have a high up take of technological know-how and the ability to take on significant level of risk.

It says the agricultural sector presents huge opportunity for the creation of employment to absorb the youth and ensure achievement of food security for future generations.


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