09 May 2019
Agribank offers relief to farmers as national drought emergency is declared
Agricultural lender, Agribank, has announced drought relief initiatives in an effort to offer relief and support to farmers countrywide.
The relief comes in two forms:
The first intervention is a payment relief on both arrears and instalments for the current year. The bank has announced that clients who are in arrears will be required to pay 45 per cent of their arrears after which the remaining arrears will be capitalised. An additional two years will then be added to the client's loan period in order to give them more time to repay the remaining amount. Capitalisation of the remaining arrears effectively means that the client will no longer be in arrears unless they fall into arrears again in the future. Once a client has settled the 45 per cent of the arrears, they will also be delisted from the credit bureau if they are currently listed by the bank. The bank has further announced that it recognizes that clients might not be able to pay the required 45 per cent in one go, so clients can pay off this amount in manageable amounts until 30 September 2019. Meanwhile, clients wishing to make use of this relief effort would be required to sign an agreement with the bank and the capitalisation of the remaining arrear and the credit bureau delisting will be effected once the agreed payment has been made.
Similarly, clients who anticipate that they will not be able to settle their annual instalments in full for the current year will be required to settle 60 per cent of the instalment due, with the remaining 40 per cent being capitalised. As with the arrears payment, an additional two years will be added to the client's loan period to make payment more affordable over time. Clients who may have difficulty meeting the payment requirements above are encouraged to make contact with their nearest branch to discuss possibilities. The bank is committed to ensuring that all clients who wish to take up the offer are assisted after consultations with the bank. Chief executive officer of Agribank, Sakaria Nghikembua, emphasised that no client should be turned away on the arrear and instalment payment relief option but that the client and the bank should engage where peculiar client circumstances exist. For this reason, the bank has set up a ‘war room’ at its head office where branches can immediately refer issues or queries they cannot resolve.
The second intervention is drought relief loans. The bank states that these loans will be offered to clients who have fulfilled the payment relief requirements and can be used for various drought related needs such as the purchasing of fodder, the drilling of boreholes or rehabilitation of boreholes or other water infrastructure, adaptive income streams such as wood and charcoal production and bush-to-feed-making equipment. Clients who qualify for the drought relief loans will receive a one-year grace period before they start with their repayment. The repayment periods for the loans after the grace period, as well as the interest rates charged, will be in line with the existing product terms of the bank.
States Sakaria Nghikembua, chief executive officer of Agribank, 'we are facing challenging times for both our clients and the bank. We want both to survive. We are trying to balance so many considerations to ensure our clients receive some scope to make it through this difficult period. We certainly wish we could do more but resources are limited. For the bank, our main source of funds is loan repayments by our clients. This means that total repayment relief is unfortunately not an option at this stage. But we believe we have done our best to assist our clients. We will maintain a flexible approach in our discussions with each client', adding 'given the urgency of the situation we have set up a war-room to deal with peculiar cases or queries which the branches might not be able to immediately deal with. This team will meet regularly to consider any such requests from the branches and provide feedback within 36 hours'.
The bank remains committed to making a difference in this situation and urges all clients to make use of the interventions being offered. The drought relief options commence on Monday, 13 May 2019. Clients are encouraged to contact their nearest branches for further details.
Chief Executive Officer
For enquiries, kindly contact the Marketing and Communications Division at:
Tel.: 061 2074332
Fax: 061 2074206
Loans are granted against security of fixed property, investment or any other acceptable form of security (fixed deposits, investments and surrendering value of policies). read more
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