The National Agricultural Development Fund (NADF) has received a N3.4 million surplus from Jaiz Takaful Insurance Limited. This payment was made under an insurance policy taken by NADF to cover agricultural and investment risks. The Managing Director of Jaiz Takaful Insurance, Ibrahim Shehu, presented the confirmation of the entitlement to NADF's Executive Secretary, Mohammed A. Ibrahim.
According to Ibrahim Shehu, the surplus arose from the 2024 financial year and was in fulfilment of an agreement reached with NADF when the Fund subscribed to the Takaful cover. He explained that under the Takaful arrangement, participants who have no claims during the coverage period may be entitled to a share of any surplus generated by the participating portfolio.
The Takaful model goes beyond providing protection against losses, as it also offers participants an opportunity to benefit from surplus sharing when the conditions of the arrangement are met. Shehu stated that the main reason for visiting NADF's office was to demonstrate that the promise made to them is now being kept.
The N3.4 million surplus payment provides a practical example of how Takaful and other non-interest financial instruments can combine risk protection with potential financial returns within the terms of an agreed arrangement. This development is expected to further support NADF's efforts to diversify financing mechanisms and strengthen access to sustainable financial services within Nigeria's agricultural sector.
NADF is intensifying efforts to develop alternative financing mechanisms for the agricultural sector, including non-interest finance. The Executive Secretary of NADF, Mohammed A. Ibrahim, said the Fund was currently validating its Non-Interest Finance Framework and Guidelines. This framework is designed to expand financing options for farmers and businesses operating across the agricultural value chain.
The framework is part of NADF's effort to develop financing options that respond to the different needs of farmers and businesses across the agricultural value chain. Ibrahim said NADF was exploring non-interest finance as an additional avenue for addressing financing constraints in agriculture and broadening access to funding for farmers and agribusinesses.
The development comes as NADF continues to explore innovative financing solutions for the agricultural sector. With the Non-Interest Finance Framework and Guidelines in place, NADF is expected to collaborate with licensed non-interest financial institutions to provide structured financing options for farmers and agribusinesses.
Key points
- NADF receives N3.4 million surplus from Jaiz Takaful Insurance.
- The surplus arose from the 2024 financial year under a Takaful arrangement.
- NADF is developing alternative financing mechanisms, including non-interest finance.
