A collaborative partnership concluded on the 10th of February 2021 saw Sterling Bank Plc, a full service licensed national commercial financial institution joining forces with globally renowned champion for African agricultural productivity and prosperity, the American incorporated African Fertilizer and Agribusiness Partnership (AFAP) to connect blenders and hub agrodealers with financing through the AFFM Credit Guarantee Scheme.
The main objective of the project is to ensure the availability and affordability of financing for the fertilizer value chain in Nigeria through the provision of a partial credit guarantee. The project has two key components: the first is to develop Small and Medium Enterprises (SMEs) in the fertilizer value chain and to allow agrodealers to provide the fertilizer and the second is to support increased fertilizer availability and project management.
Under the project, one of the key activities carried out by AFAP involved the identification of diligent blenders and their recommended hub agrodealers, who would be able to participate in the AFFM Credit Guarantee Scheme.
Their selection would not only allow them this participation but also the chance to be further financed by any financial institution collaborating with AFAP. Ten blenders and 40 hub agrodealers have been assessed and have qualified for the intended purpose of successfully implementing the AFFM Credit Guarantee Scheme.
Under the partnership, Sterling Bank Plc will ensure the blender accounts are opened and credited with the proceeds of sales as agreed with the blenders during the guarantee period.
This partnership between Sterling Bank PLC and AFAP will allow AFAP to track the financial flow between the blenders and the hub agrodealers and to mediate trade settlement between the bank and AFAP. AFAP and Sterling will jointly monitor the dedicated accounts in terms of their performance.