Africa-Press – Tanzania. DAR ES SALAAM: THE Tanzania Agricultural Development Bank (TADB) has signed a new agreement with the Tanzania Commercial Bank (TCB) to boost credit guarantees to small-scale farmers through the Smallholder Farmers Credit Guarantee Scheme (SCGS).
The TADB said the new five-year partnership deal with TCB signed in Dar es Salaam was worth 21bn/- up from 7bn/- allocated in 2018 when the credit guarantees to smallholder farmers were initiated.
TADB Managing Director Mr Frank Nyabundege said in Dar es Salaam yesterday that the agreement implemented through the Smallholder Farmers Credit Guarantee Scheme (SCGS) would double the accessibility of loans among smallholder farmers unlike before.
“With the new partnership, we expect to increase the number of credit provisions to smallholder farmers,” he said.
Mr Nyabundege said that TADB has made improvements in the rate of credit guarantees for women and youth to 70 per cent from 50 per cent in 2018.
In line, he said, the objective of the new partnership is to increase the scope of lending in the agricultural, livestock and fishery sectors.
“The increase in the scope of credit provision would not only improve income among smallholder farmers but also reduce poverty and stimulate the development of the sector and increase the national income,” he said.
He said the cooperation between the two financial institutions has been very productive and beneficial for smallholder farmers and the agricultural sector.
He added that as the initial contract entered in 2018 comes to an end, TCB through the credit guarantee from TADB has already provided credits worth 34.1bn/- to more than 2,638 direct beneficiaries and more than 7,750 indirect beneficiaries.
“Also a total of 4.3bn/- has been disbursed to 448 women while 3.4bn/- to 416 youth in various areas across the country,” he said.
According to him, until December last year, the total loans guaranteed by TADB through SCGS was 250.77bn/- whereby over 19,400 people benefited as direct beneficiaries and over 897,900 as indirect beneficiaries in 27 regions which is equivalent to 87 per cent of all regions in both mainland Tanzania and Zanzibar.
On his part, the TCB Chief Executive Officer, Mr Adam Mihayo said he is optimistic that the agreement between the state-owned institutions would enable to promote export and address the foreign currency deficit.
He said the move would not only raise individual income among farmers, herders and fishermen but also would the country create more job opportunities.
He also commended the efforts made by the government in bolstering the state-owned financial institutions to boost the nation’s backbone sector.
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