A Central Bank of Nigeria official has identified poor funding for agricultural research and inadequate infrastructure as major factors limiting access to finance for Nigerian farmers. Dr. Michael Ononugbo, CBN Deputy Director and Special Assistant in the Office of the Deputy Governor, Economic Policy Directorate, stated this at the National Close-Out Conference of the Global Project for the Promotion of Agricultural Finance for Agri-based Enterprises in Rural Areas in Abuja.
The eight-year German-funded project, GP AgFin Nigeria, reached 101,449 farmers and agribusinesses across 10 states. Ononugbo noted that smallholder farmers and rural enterprises faced several challenges that made conventional lending difficult, including fragmented landholdings, limited access to technology, weak infrastructure, and climate-related vulnerabilities.
Ononugbo emphasized that agricultural producers were frequently underserved by formal financial institutions despite the sector's strategic importance. He stated that successive policies had focused too much on increasing credit supply without addressing whether financing was suitable for farmers' realities.
The CBN official warned that financing that was poorly structured, untimely, expensive, or disconnected from production realities may fail to improve productivity and exacerbate the vulnerability of borrowers. He also questioned the level of funding for agricultural research, saying inadequate investment was limiting innovation and productivity.
Ononugbo stressed that sustained investment in research was necessary to develop innovative solutions and improve productivity in the agricultural sector. Dr. Andrea Rüdiger, Cluster Coordinator for GIZ's Transformation of Agri-Food Systems programme, said the GP AgFin experience showed that the financing gap could be reduced through appropriate tools and institutional support.
Rüdiger noted that the project had grown from 1,260 financial service users in 2020 to more than 101,000 by mid-2026, while loan disbursements rose from €776,000 in 2021 to €53.9m. She called for the project's lessons to be integrated into mainstream policy and financial institutions, including efforts to improve compliance with the CBN's agricultural lending target.
The stakeholders emphasized that embedding the project's lessons in national development and agricultural policy frameworks would be critical to sustaining access to finance beyond the intervention. The project's tools and partnerships are expected to transition into GIZ's EU- and BMZ-co-funded Value Chain Enhancement programme as GP AgFin formally winds down in October 2026.
Key points
- The Central Bank of Nigeria has identified poor funding and inadequate infrastructure as major factors limiting access to finance for Nigerian farmers.
- The GP AgFin Nigeria project reached 101,449 farmers and agribusinesses across 10 states, with loan disbursements rising to €53.9m.
- Stakeholders emphasized the need to integrate the project's lessons into mainstream policy and financial institutions to sustain access to finance.
