The Federation Allocation Accounts Committee (FAAC) has deducted a total of N622.75 million over 15 months to repay loans disbursed to farmers under the Central Bank of Nigeria’s (CBN) Anchor Borrowers Programme (ABP).
Established in November 2015, the ABP was designed to create economic linkages between Small Holder Farmers and agricultural “anchors.” According to FAAC’s revenue disbursement report, monthly deductions of N45.52 million were made from May 2023 to July 2024, amounting to N622.75 million.
However, this repayment remains a small fraction of the N450.90 billion still owed to the CBN as of March 2024. The deductions, listed as “CBN Anchor Borrowers,” were taken from the nation’s gross revenue each month, but the report did not specify which state or association the repayments were attributed to.
The CBN has since discontinued the Anchor Borrowers Programme and is focusing on recovering the outstanding loans. Repayment by beneficiaries has been challenging, prompting the bank to adopt additional measures. President Bola Tinubu has reportedly directed security agencies to assist the CBN in recovering the funds.
Additionally, the CBN has suspended new loan applications under its intervention programmes. CBN Governor Yemi Cardoso noted that some of the bank’s past challenges were linked to “development finance activities,” including quasi-fiscal operations.
A CBN official confirmed in April that a committee had been formed to facilitate loan recovery. “There were laid-down procedures between the banks and the apex bank, and these laws will be enforced to recover the funds,” the official stated.
The ABP benefitted approximately 4.67 million farmers engaged in maize, rice, and wheat farming. A CBN document revealed that top beneficiaries included Kebbi State, the Rice Farmers Association of Nigeria, the Cotton Producers and Merchants Association of Nigeria, the Maize Growers and Processors Association of Nigeria, and Afex Commodities, among others.
Meanwhile, the federal government removed N1.014 trillion in statutory deductions between January and July 2024. This amount reflects a 13.42% increase (or N120.12 billion) from the N894.77 billion deducted during the same period in 2023. The rise is largely attributed to foreign debt servicing payments made on behalf of state governments, as well as other statutory deductions, which have constrained funding for essential services and development projects.