Nigeria: MFBs to emerge stronger, improve access to finance

By Akin Yusuf , Businessday Online

…As CBN categorises capital base licence

There is high expectation of enhanced access to finance by the active poor population in the country following the categorisation of the sub-sector into Unit, State and National MFBs.

Formerly, there were two categories of microfinance banks which include unit and state licence. The minimum capital requirement of this classification was N20 million and N1 billion, respectively.

But last week, the Central Bank of Nigeria (CBN), in its revised policy framework for microfinance banks, came up with three categories of MFBs.

The new guideline stipulates that those under the Unit category will have a minimum paid-up capital of N20 million, those that will apply for state will have a paid-capital base of N100 million, while those for national will have a paid up capital of N2 billion.

Meanwhile, mixed feelings have trailed the categorisation by operators. Olufemi Babajide of the National Association of Microfinance Bank (NAMB) Lagos chapter, who spoke with BusinessDay, regretted that there was no inclusion of regional licence in the categorisation.

He said for instance, there are operators who might want to operate in areas such as Lagos and Oyo, without going to other areas like Kwara.

To Godwin Ehigiamusoe, managing director of Lift Above Poverty Organisation (LAPO) Microfinance Bank, who also spoke with BusinessDay, the N2 billion national licence was both reasonable and appropriate at the moment. He said the latest categorisation will lead to the emergence of strong national microfinance bank that will deliver responsive service to the clients.

“The N2 billion is quite okay to fund the operations of microfinance banks in Nigeria,” he said.

The regulatory authority explained that a Unit MFB that intends to transform to a State MFB shall be required to surrender its licence and obtain a State MFB licence, subject to fulfilling stipulated requirements.

For a State MFB that intends to transform to a National MFB must , at least, five branches which are spread across the local government areas in the state. This is to ensure that the MFB has gained experience necessary to manage a National MFB. It shall also be required to surrender its licence and fulfill other stipulated requirements.

The CBN, however, said the prescribed minimum capital requirement for each category of MFB may be reviewed from time to time.

Among other responsibilities, the policy assigns the government the responsibility of setting aside an amount not less than one per cent of the annual budgets of federal, state and local governments for microcredit initiatives.

Under the revised framework, MFBs shall be required, among others, to be adequately capitalised, better spread, run a low cost structure and be operated in a safe and sound manner.

According to the CBN, there exists a huge untapped potential for financial services at the micro level of the Nigerian economy. Attempts by government in the past to fill this gap were not sustained.

“The Microfinance Policy was therefore developed in 2005 to further address the observed gaps, the policy focused mainly on private sector-driven arrangements, with the establishment of microfinance banks,” the apex bank stated.

Nigeria: When the police, EFCC recover MFB loans…

By Hope Moses-Ashike, Businessday Online

At what expense?

Loan repayment has been a major problem in microfinance banking in the country and across the globe.

There is no doubt that some microfinance banks have closed shop because they were not able to recover the loans given to their customers.

For instance, the problem of one of the liquidated microfinance banks started when one of the markets in Lagos, where most of the bank’s customers were doing business, was demolished by the Lagos State for beautification exercise initiative.

Most customers, who took loan from the bank, disappeared and could not be located. Although the bank could not give the figure, it lost a huge amount of money as a result, and that gradually led to the demise of the bank.

In finding a lasting solution to the high level of non-repayment, some microfinance banks now employ the services of police and operatives of the Economic Crime and Financial Commission (EFCC) official to help them recover the loans.

Investigation reveals that these law enforcement agents charge 10 percent of the total loan recovered.

Consequently, customers who have defaulted are subjected to pay the 10 percent while repaying their loan.

One of the staff of a microfinance bank in Lagos who pleaded anonymity said the strategy has helped them a lot in recovering their loan. The staff noted that sometimes a large number of the bank’s staff will storm the business premises of a particular customer who refuses to repay its loan.

Reacting to the development, Olufemi Babajide, National Association of Microfinance Bank (NAMB) Lagos chapter, said in telephone interview that he is not aware of law enforcement agents charging 10 percent of the total loan recovered.

He explained that the police and the EFCC are not supposed to look into loan recovery because they are not recovery agents, adding that they can only exercise power on this when there is law passed to criminalise loan default.

“We are appealing to the Central Bank of Nigeria (CBN) and the other regulatory authorities to let us put in place a bill that will make it criminal offence,” he said.

According to the regulatory guideline for microfinance banks by the CBN, a microfinance loan is a facility granted to an individual or a group of borrowers whose principal source of income is derived from business activities involving the production or sale of goods and services.

The maximum principal amount shall not exceed N500, 000 or/ and as may be reviewed from time to time by the CBN. Generally, a microfinance loan is granted to the operators of micro-enterprises, such as peasant farmers, artisans, fishermen, women, senior citizens and non-salaried workers in the formal and informal sectors.

The said loans are usually unsecured, but typically granted on the basis of the applicant’s character and the combined cash flow of the business and household. Ordinarily, the tenure of microfinance loans is 180 days (6 months).

However, in the case of crops with longer gestation period, a maximum tenure of 12 months shall be permitted. Microfinance loans may require joint and several guarantees of one or more persons.

The repayment may be on a daily, weekly, bi-monthly or monthly basis in accordance with amortisation schedule in the loan contract.

It has been reported that in Lagos State alone, over N10 billion were being owed by these micro depositors who borrowed money form their various institutions.

In view of this, Babajide advocates for the establishment of special courts to try loan defaulters. According to him, various strategies had been employed to ensure that the loans owed by the microfinance institutions were repaid, but the effort had yielded no positive result.

Nigeria: Microfinance – Ekiti disburses N40m to entrepreneurs

By Gbenga Ariyibi Ado Ekiti, Vanguard

Ekiti State has  disbursed  the sum of N40 million micro-credit revolving loan to about 1,000 self employed individuals and groups  across the  state.

Speaking while distributing cheques to the beneficiaries of the loan in Ado Ekiti, the state governor, Dr Kayode Fayemi said he decided to jettisioned the mentoring  method  adopted by the immediate past administration led by Engr Segun Oni in the state

He regretted that  millions of naira  of micro- credit fund  belonging to the state government were trapped in the hands of mentors and guarantors of the beneficiaries during the regime, saying he preferred to have a direct  access to  individuals and groups who wish to benefit  from the revolving loan.

Fayemi assured that his government  would not mount undue pressure on the beneficiaries in its attempt to recoup the fund from them, just as he would give recognition to individuals and societies that indicate intention to benefit from scheme.

The governor urged the beneficiaries to respond quickly to the repayment of the loan to allow other  members of the public to benefit.

Fayemi noted that members of the drivers and motorcyclists unions in the State have benefited similar gesture in the past, adding that all the sectors of the economy will benefit from the gesture to give the State a robust economic base  to reduce poverty among the citizenry.

He said  his government is  poised towards making poverty a history in the State by tackling the menace at all fronts through provision of jobs to unemployed youths and by encouraging self employment among the youths.

Responding on behalf of the beneficiaries, the Iyaloja of Igbara-Odo Ekiti in Ekiti South West Local Government Area of the State, Chief Mrs Ajoke Haastrup, appealed to members to make judicious use of the fund

She appealed to them to repay the money at the expected time to encourage the government to sustain the scheme and widen the frontiers for more beneficiaries.

Nigeria: Persistent ‘macro’ concerns about micro-finance

By Tomi Ogunlesi, Businessday Online

Suddenly the sector seemed to have become the ‘next-rated’ hotspot in the financial services industry, as it fast became the toast of government, regulators as well as multilateral bodies such as the World Bank and IMF (who were willing to advance take-off grants to the ‘convincing’ ones…even top executives of commercial banks were seen resigning from their perked positions in droves to float/manage.

Microfinance outfits…Enter the financial whiz-kids, purportedly here to empower the poor and down-trodden, while changing the face of the sector for good. In concert with the well intended efforts of the regulatory watchdogs i.e. CBN and NDIC, the death knell had effectively been sounded for those humble concerns cherished by the masses and known as ‘Community’ banks and voila…the entire landscape rapidly became dotted with fledgling microfinance outfits!

So, we find ourselves asking …..So, what actually happened along the line? I’m no banker, but from a carefully situated personal perspective, my opinion is that our microfinance bankers started out with commendable vision and ideals but apparently got it twisted somewhere along the line (I actually stand to be corrected on this, as it represents a purely individual assessment of the dynamics of this sector)

Let us briefly cast our minds back to the very beginning. Decades ago, Mohammed Yunus described his search for new bank clients as a process of “looking for the most timid.” He wasn’t looking for the villagers who were the first to step forward to ask for a micro-loan starting at less than $10, he was looking for those who were last to come forward and who trusted their abilities the least. To those villagers, he and his staff would say, “Yes you can.”

He was so shaken by the sight of people dying of starvation that when he set foot in Jobra, the Pakistani village next to his campus, all he wanted to do was to see if he could be of use to one person for one day – not 40 million, just one.

It was in that village that he met a stool-maker who horrified him when she explained that she earned only 2 cents a day for her beautiful craftsmanship. With no money to buy the bamboo she needed, Sufia Khatun was forced to borrow from a moneylender who demanded that she sell her finished stools back to him at a price he set – a price so low that she made only 2 cents a day profit.

When he asked whether she could earn more if she was freed from the moneylender, she told him, “Yes I can.” Professor Yunus had a student look for other villagers who were in the same dilemma. The student found 42 people, who needed a grand total of $27 to pay off the moneylender, buy their raw materials and sell their wares to the highest bidder. That’s right; all they needed was an average of 68 cents each. With her loan of less than $1 the stool-maker’s profits soared from 2 cents a day to $1.25 a day.

Thirty-three years later, nearly 8 million members of Grameen Bank (a total of 40 million when you count their family members) are saying “yes we can” to the whole world. Since its inception, Grameen Bank has lent more than $8 billion to the poor in Bangladesh.

On the contrary, it seemed his counterparts back at home in Nigeria were working at cross-purposes to the very ideals they were set up for. By omission (or commission!), a vast majority of them outrightly ditched their callings and embarked on a collision course (howbeit expressly doomed to accelerated failure) with the consolidated megabanks (especially in Lagos). With the new awakening to ‘branding’ and the limitless possibilities it offered, alongside their new and intricate logos and corporate outlooks came the prestigious corporate head offices and branches, ostentatious fleets of automobiles etc, most of these acquired with the hard-earned resources of depositors.

At some point they became virtually indistinguishable from commercial banks in outlook. It was even reported that some of the microfinance institutions charged interest rates as high as up to 100% for lending and payed as low as 5% on savings……..all of which leads to the logical and fundamental question of who their target market was intended to be, in the first place ! Now, in putting this into proper perspective in the Nigerian microfinance context, the existing microfinance framework in Nigeria serves less than 1 million people out of 40 million being the potential number that need the service. Also, the aggregate micro credit facilities in Nigeria, account for about 0.2 percent of the GDP and is less than one percent of total credit in the economy. Addressing this situation inadequately would further accentuate the problem and slow down growth and development of the country.

One can only earnestly hope that the regulators and other relevant stakeholders will concert their efforts towards entrenching a functional and effective microfinance framework which optimally performs the intended intermediation function and by so doing bridges the wide gulf between available financing for the SME sector and the fledgling entrepreneurs and businesses who critically require this to move on to their next levels.

Nigeria: Expert blames rural backwardness on non-patronage of MFBs

By Gbade Oshin, Nigerian Tribune

A financial expert, Prince Fola Aderoju has hinged the slow pace of rural development in Nigeria on the failure of states and local governments to give adequate patronage to the nation’s microfinance banks. (MFB)s.

Speaking at a Community Development Association meeting in Iseyin, Oyo state, Prince Aderoju believed that adequate patronage of MFBs by states and local governments would have raised the standard of living of rural communities through promotion of economic and social well-being of the people.

Besides, such patronage, according to the finance expert, would have promoted more development activities resulting in the establishment of more and more small and medium scale agro-allied industries for the benefit of the rural populace thus cheking rural-urban drift.

Prince Aderoju noted that when the federal government established community banks, now microfinance banks in 1990, the intention was to make them serve as bedrock of rural economic transformation in which states and local governments should play active role.

“Surprisingly however, rather serve as agent of rural transformation, the state and local governments have remained passive, thus leaving the rural communities to their plight”, he lamented.

Prince Aderoju, however, said that in spite of the failure of the state and local governments to join hands in empowering the rural communities through determined patronage, the microfinance banks had been rendering improved and selfless service to the rural communities since their conversion from community banks.

Nigeria: Microfinance products panacea to poverty – Operators

By Amaka Abayomi, Vanguard

Poised to make the future of their clients bright and in keeping with the vision of being microfinance banks (MFBs) that truly provide financial services to people at the lower rung of the society, especially the less privileged and the active poor, most MFBs in the country have designed an array of financial products and services that would suit their end users.

In Nigeria, as in many developing countries, MFBs have designed systematic approaches and well articulated programmes through the provision of credit facilities and financial services to low income earners and micro entrepreneurs and these are believed to be the panacea to socio-economic growth.

Explaining why the management of his bank and, invariably, other MFBs have designed such financial products for their customers, the Head, Public/Media Relations Unit of Umuchinemere Pro-credit Micro Finance Bank (UPMFB), Sir Abuchi Anuyiagu, said apart from keeping with their mission of being an MFB with ethical standards, such products enable them to offer the best-in-class financial products and services that are innovative, socially responsible, customer focused, grassroots oriented as well as promoting integral human development.

“At UPMFB, we offer current account, savings account, fixed deposit account and offer loan account for taking and repayment of loans to our customers.

“On products, UPMFB offers small and medium scale enterprise loan; salary advancement loan; three-wheeler rickshaw taxi leasing; micro credit fund for groups; and micro leasing.

“Others are education advancement loan; seasons loan; agriculture loan; wedding loan; small business loan; workers loan; house improvement loan. We have plans to go into micro insurance scheme and may also go into micro health insurance scheme in the nearest future.

“Part of the reasons why we designed these products is to improve the lives of the active poor; to act as a partner and catalyst for the achievement of governments’ poverty eradication programme; to meet the financial needs of the poor and the unbanked and to give the poor a lifeline and empower them to fight poverty.

Recognising that different customers have different needs, the management of Accion MFB designed specific commercial and personal financial products to help their customers develop and grow their businesses, meet their short term liquidity requirements and save for a brighter future.

For people who want individual and family savings, Accion’s My Brighta Family Future Account is the answer as the accumulated funds can be used to acquire or increase the value of assets, enable the individual or family to take charge of their financial situation or save towards future plans which in the long run, will aid financial self-sufficiency.

For individuals or entrepreneurs who desire a traditional savings account for transaction purposes, My Brighta Business Saving Account is it while the My Brighta Business Current Account is a transaction account for SMEs who perform moderate volumes of transaction with third parties and require convenience and ease in carrying out these transactions. This account provides ready access to funds through cheque or branch.

My Own is a loan facility targeting micro and small businesses whose analysis is based on capacity to repay. The loan provides financing for working capital purposes.

My Own Plus is a consumer loan that is payroll based, as a short and medium term credit facility. It’s basically a consumption loan. Our Own is a wholesale micro finance product that seeks to avail loans to micro entrepreneurs through institutions, registered associations that enter into partnership with AMfB.

Determined to ensure that the highest level of banking standards in terms of efficiency, customer satisfaction, transparency and accountability are upheld, AB Microfinance Bank designed a set of core products, notably Micro and SME loans, as well as current, savings accounts and term deposits with the target customer group in mind.

AB Current Account gives you unlimited access to your money at all times and you can manage your business, execute payments and receive salary through this account. Available to individuals and corporate bodies, benefits include zero minimum opening balance; internal and local money transfers; encashment of cheques and dividend warrants; standing order transfers/payments; free statement of account (on request); affordable pricing; and transparent and speedy transactions.

AB Term Deposit Account (TDA) allows owners to fix their money for a chosen period of time and gain attractive interest rates. Done by opening either a savings or current account, the benefits are affordable minimum deposit of N20,000; competitive interest rates; flexible tenure, between 30 – 360 days; and stable interest rates throughout the duration of the term.

It behoves on MFB customers to take advantage of the numerous products available to grow their businesses and secure their future.

Nigerians not willing to repay loans, says MFB operators

By Bukola Amusan, The Nation

The Managing Director of Future Growth Microfinance Bank, Frances Bekey, has said the unwillingness of Nigerians to repay loan is one of the major constraints facing the growth of microfinance banks in the country.

Bekey, who spoke yesterday in Abuja at the opening ceremony of Abuja Trade Show, said women still constitute about 89 per cent of people that are prompt in repaying loans.

She said the bank is partnering with organisers of trade fairs to boost trade and enhance development.

The organisers of the show, said the concept was designed to discourage the habit of hawking, open display, or selling of goods from vehicles at public functions in the Federal Capital Territory (FCT).

Jokodola Osazee Jarikre, one of the organisers of the show, said the trade show is creating a market place where people could bring in their goods and services and sell to the public.

“You may have observed that at any gathering in Abuja, you see a lot of people who come around there and display their wares while some sell from their cars. The Abuja National Mosque used to be one of such places where people from all over Abuja and neighbouring towns come to sell their wares. So we felt there is a need to create a regular market place where this people can bring in their wares and sell from time to time,” he said.

The trade show which made its debut on April 28, will terminate on May 12. He said the fair would offer a unique platform for businesses, while there would also be an entertainment session where musicians, comedians and dancers would thrill visitors.

He described the business environment in Abuja as one that is fast growing and thus there is a need to encourage those doing business, especially young graduates who ventured into business after their national service.

Nigeria: MFB operators in frenzy as CBN commences inspection

By Amaka Abayomi, Vanguard Nigeria

As the Central Bank of Nigeria (CBN) commences inspection of microfinance banks (MFBs) to ascertain the level of compliance with the CBN’s stated guidelines with regards to the 103 MFBs granted approval in principle, operators in the microfinance sector are thrown into frenzy as fears are heightened that the sledge hammer of the apex bank may fall on MFBs that failed to meet the deadline set by CBN.

Vanguard’s investigations reveal that the CBN has commenced another round of inspection to ascertain how well the affected MFBs have complied with the CBN’s directives

According to Vanguard’s investigations, the on-going CBN’s inspection, which is the first after the recent reforms, is targeted at liquidity, capital adequacy and level of compliance of the operators to the reform guidelines after numerous complaints from customers and operators.

While some MFBs may have survived the regulatory bodies’ tests, others who were granted approval in principle for new licenses, which is subject to their ability to meet some set conditions by the apex bank, are keeping their fingers crossed with the hope that it would be a smooth scaling for them.

But the task ahead is for them to ensure that they meet the set standards or face more penalties as the CBN has promised to ensure that appropriate penalties are meted out to defaulters.

According to a CBN source, who pleaded anonymity, the inspection exercise is aimed at revealing the true status of the MFBs which will enable to CBN take appropriate actions on those still lagging behind. The inspection is expected to end by June 2011,

It would be recalled that in February 2010, the CBN and the NDIC began an examination of all MFBs in Nigeria as a response to MFB failures and complaints from customers. The examination revealed that theCBN licensed many weak, failing community banks as MFBs, without addressing their original problems, proving that rebranding does not turn an incompetent financial institution into a strong MFB.

Also, too many MFBs were licensed at the same time, making it difficult to supervise them and most of their customers’ deposits were not insured, which negatively affected customer confidence.

In September, the CBN revoked the licenses of 224MFBs that were ‘terminally distressed’ and ‘technically insolvent’ and/or had closed shop for, at least, six months. According to the CBN, these MFBs were deficient in their understanding of the microfinance concept and the methodology for delivery of microfinance services to target groups.

The CBN cited ‘loss of focus’, and pointed out that although regulatory authorities tried to put them back on track, failure was inevitable.

Commenting on the state of the microfinance sector, the Deputy Governor, Financial System Stability (FSS), CBN, Dr. Kingsley Moghalu, said non-performing loans, resulting in high portfolio at risk (PAR), which impaired their capital; gross under-capitalisation in relation to the level of operations; poor corporate governance and incompetent boards; high level of non-performing insider-related credits, and other forms of insider abuse; heavy investments in the capital market, with the resultant diminution in the value of the investment after the meltdown are some of the factors that contributed to the failure of these banks.

Commenting on the preparedness of his bank to face the inspection team of the CBN, a Managing Director of one of the affected MFB, who spoke under the condition of anonymity, said though his bank is yet to be inspected, but all is in order and are being expected.

Another MFB boss whose bank is granted AIP stated that the bank’s directors are responsible for the increase in their capital base from N52m to over N100m as it depleted due to panic withdrawals from customers.

Nigeria: Central bank goes tough on microfinance banks

By Stanley Oronsaye, 234Next.com

In a bid to check abuse and to tighten the regulatory environment, the Central Bank of Nigeria (CBN) has insisted that microfinance banks in the country must comply with the new reporting format.

It said in a memo dated April 12 and signed by Olufemi Fabanwo, the director, Other Financial Institutions Department, that all microfinance banks must from the second half of the year adopt online rendition of their monthly returns, which commenced in January.

“All MFBs are required to render all subsequent monthly returns electronically. For the avoidance of doubt, the receipt of hard copy return will stop with the June 2011 return, after which only electronic returns will be acceptable,” the circular stated.

The online reporting is expected to strengthen the regulation of operators in the sector.

There are currently over 700 microfinance banks in Nigeria which the CBN has said is a daunting task monitoring. The regulator in September revoked the licence of 224 microfinance banks that were found to be ‘terminally distressed’ and technically insolvent.

When asked how microfinance institutions in the rural areas would be able to comply, CBN spokesperson, Mohammed Abdullahi, said no firm is exempted.

“They are all expected to comply regardless of whether they are in the rural areas or urban centres,” Mr. Abdullahi said.

“That is the condition. There is no rural area in Nigeria without Internet access. Once you buy the modem, you should be able to do so. This is a regulatory directive and all microfinance banks are expected to comply,” he added.

The CBN cited high level of non-performing loans, undercapitalisation in relation to the level of operations, poor corporate governance, and incompetent boards, as well as high level of non-performing insider-related credits, for the failure of some of the institutions.

The regulator also recommended that the directors and management of the closed banks who abused their positions would be handed over to the law enforcement agencies for investigation and prosecution, while those found guilty would be blacklisted.

CBN deputy governor, Financial Systems Stability, Kingsley Moghalu, attributed the failure of the sector to the impact of the global financial crisis which dried up credit lines and increased credit risk. He said it was the combination of these factors that had significantly weakened the microfinance sub-sector and its ability to achieve the policy objective of economic empowerment at the lower end of the market.

Since then, the CBN has said it would review the operational guidelines for MFBs in the country. This would include a qualification for chief executives and increase in minimum required capital.

The CBN estimates that a huge number of Nigerians are unbanked, with only less than two per cent of the rural populace having access to financial services.

“The eight leading Micro Finance Institutions (MFIs) in Nigeria were reported to have mobilised a total savings of N222.6 million in 2004 and advanced N2.624 billion credit, with an average loan size of N8,206.90,” according to the guideline report.

The report also stated that as at end-December 2004, the total currency in circulation stood at N545.8 billion, out of which N458.6 billion or 84.12 per cent was outside the banking system.

Microfinance institutions were seen as a means of mopping up much of the funds outside the banking system, a role which they have not been able to play effectively.

Nigeria: Regulators to Restructure MFBs for Agric Funding

By Obinna Chima, This Day Live

Regulators of the Nigerian banking industry have disclosed plans to overhaul the Microfinance Banking sub-sector to enable it participate actively in the development of the agricultural sector.

According to the regulators, MFBs in the country were yet to play the role of poverty eradication for which they were created.

Managing Director and Chief Executive Officer, of the Nigeria Deposit Insurance Corporation (NDIC), Alhaji Umaru Ibrahim, who dropped this hint at a retreat on the Nigerian Incentive-Based Risk Sharing Agricultural Lending (NIRSAL) organised by the Bankers’ Committee at the weekend in Lagos.

Ibrahim explained: “We need to transform the microfinance banking sector. I strongly believe that the sub-sector also needs to be overhauled so as to play effective role in the funding of the agricultural sector and poverty eradication.

“We visited Bangladesh recently and we saw how the microfinance institutions in that country are empowering the people and supporting the growth of the economy.”

The Central Bank of Nigeria (CBN) had intervened in the sub-sector last year following lack of corporate governance structures among other anomalies engaged by microfinance operators.

To the CBN Governor, Mallam Sanusi Lamido Sanusi, the regulatory framework for microfinance banks has been developed by the apex bank.

“The regulatory framework for microfinance banks is ready, but I stepped it down so that we (the CBN) can review our supervisory duties,” he added.

To the Managing Director and Chief Executive Officer, Unity Bank Plc, Mr. Falalu Bello, the absence of banking services in the rural areas of the country had also affected the agricultural sector financing. He expressed optimism that the new banking structure which provides opportunity for regional banking would address the challenge.

“As operators, we must support and promote the idea of regional banking so as to develop the agricultural sector,” Bello noted.

Commenting further on insurance for agricultural products, Sanusi said: “Banks are there to take credit risk and they do not pass them to the insurance company. I have never believed in anybody coming to tell me that an insurance company is insuring credit risk.”

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