The Agriculture Finance Corporation waives interest on farmers' loans
| Oct 17th 2016 | 1 min read
The Agriculture Finance Corporation (AFC) has waived interest on loans owed by wheat and barley farmers.
Narok farmers who took loans with AFC got a reprieve when the corporation's board quashed penalty interest to enable them repay their loans, which have accrued to Sh750 million.
Speaking at AFC Narok branch offices when he met farmers unable to repay their loans after making losses occasioned by bad weather and poor prices, AFC board chairman Franklin Bett said the removal of interest would protect the farmers from further accumulation of debt.
Mr Bett gave the Narok branch officials one month to gather the farmers' loan details.
The wheat, barley and livestock farmers under the Lanterera Co-operative Society have been seeking a waiver for the loans that have been accumulating since 2006.
In a memorandum presented on their behalf by their secretary, Samuel ole Kimelok, the farmers cited a tremendous change in weather patterns, including prolonged rains, that affected 90 per cent of their crop.
Bett however said the board could not grant a loans waiver and encouraged the farmers to continue repaying what they owed.
"We do acknowledge weather and market challenges. I will also need a report on the farmers' loan details so that we can present it to the relevant ministry," he said.
He said the default rate in AFC ranges between 49 and 56 per cent.
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