Board declines to write off loans as sorghum deal flops

Farmers who were given loans by the county government to plant sorghum in a contract farming programme will have to repay them.

This is after the Enterprise Fund Board declined to write off the loans despite crop failure.

According to the fund’s manager Cecilia Maina, the farmers who were introduced to contract farming signed the agreement on loans and crop failure was not a condition to inhibit repayment.

“The crop failed to yield, but we had a legal agreement with farmers. They will have to pay back the loans with interest,” said Ms Maina.

Some farmers argued that since the sorghum project flopped and almost everyone made losses, the county government should write off the loans.

The board disbursed more than Sh1.5 million loans to five groups that were to plant sorghum.

The farmers received loans to facilitate them to purchase seeds, fertilisers as well as to finance land preparations, crop management and harvesting.

Instead, Ms Maina noted that the county government had instead decided to reschedule repayment periods.

Some of the farmers received loans directly from the Enterprise Fund Board while others applied through Nanyuki Equator Savings and Credit Co-operative Society (Necco Fosa).

Tourism, Trade and Cooperative Development department had given Sh700,000 loan to Necco Fosa from the county’s revolving fund for the same farming project.

According to Maina, only one group had started repaying its loan.

Necco Fosa CEO Faith Muchoki told The Standard: “The farmers will have to repay the loan because we are also paying the county government. We will pursue them since there was no agreement that if there was crop failure, they were not going to pay. But if the county writes off the loans, we will also write-off what the farmers owe us.”

The intention of the programme was to make farming profitable. The county government had planned to facilitate them to get into legal contract with the East African Maltings Ltd (EAML).

However, the crop failed, since the agriculture department that was to facilitate farmers to get into an agreement with EAMl did not do so and hence there was no proper monitoring of the crop.