By Tina George, Minna
The International Fund for Agricultural Development (IFAD) is conducting financial literacy for IFAD-VCDP staff and lead farmers in Niger state.
During the stakeholders workshop, which took place in Bida on Monday, a German financial analyst, Micheal Marx called on Nigerians to embrace indigenous forms of savings and credit as a way of becoming financially independent.
According to him, it is necessary for the people to save in one way or the other, adding that without the indigenous forms of savings and credit, which includes esusu and ajo, the people will find it difficult to get by.
Emphasising on the gigantic, huge and immense benefit of the indigenous savings and credit, Marx said that it is one of the best economic options whose importance should not be overlooked.
While emphasising that indigenous savings and credit is convenient for everyone to participate, he added that even though the loan is normally small and the loan duration very short, there was no much difference between the indigenous savings and the formal banking sector.
“This is why bankers are interested in indigenous savings groups because the members have good saving discipline, are organized and understand obligations and rights,” Marx stressed.
He said that the training would make the farmers understand how bankers think; enhance their negotiating skills when it comes to financial institutions and prepare them in a way that would make the banks unable to refuse their request for loans.
The IFAD Coordinator, Dr. Mathew Ahmed also said that the training, which was being organized for farmers in Niger and Ogun states was to enhance farmer’s financial literacy and inclusion.
He added that the training was to ensure that the farmers were able to make informed decisions regarding their finances and do not fall prey to loan sharks.
Ahmed lamented on the inability of farmers to keep records of their transactions, adding that this had made it difficult for them to assess loans from banks.
The Coordinator said that the training was aimed at sustaining and inculcating savings culture in them, which would go a long way in increasing the financial status of the farmers.
“Although, we are training the lead farmers but these farmers will go down to their groups and clusters to train their members,” he said.
The IFAD VCDP Rural Institution, gender and tough development Officer, Musa Dalung stressed the importance for farmers to know how to calculate interest rates from banks and calculate the rate of depreciation of their equipments.
“Based on the capacity given to the farmers in these past years, we feel the aspect of financial literacy is critical if they must continue in their business. “
He disclosed that the farmers have had a lot of problems with interest rates charged by the banks.
“These banks charge very high and farms e cannot afford to collect the loans and pay. Sometimes the period of repayment is very short. The financial institutions, in calculating their interest rates are not usually fair to the farmers.
“But with this training, the farmers will be able to calculate the interest rate, they will be able to take decisions from informed position to see how profitable it is to take some loans.”