AFC Holdings to raise more funds to oil agriculture growth

Business Reporter
THE Agricultural Finance Company (AFC) Holdings has secured regulatory approvals to raise more funding from the market through agro-bills to support the summer cropping season.

Launched by President Mnangagwa in April, AFC has four subsidiaries namely AFC Commercial Bank, AFC Insurance, AFC Land and Development Bank and AFC Leasing Company.

The Reserve Bank of Zimbabwe (RBZ) recently availed AFC with $500 million towards financing the 2020/2021 winter wheat programme.

AFC will, thus, expand access to credit to all types of farmers (A1, communal, resettled, smallholder farmers, A2/ commercial farmers).

It has the mandate of supporting the Government thrust for agriculture production, productivity and food systems transformation.

In a statement yesterday, AFC (formerly Agribank) said plans were already underway to ensure the next summer cropping season was another success.

The financier would be going to the market with an agro-bills paper to raise funding for farmers in respect of both working capital and infrastructure financing.

“The bank is at an advanced stage of the process and has funding structures and instruments in place. In addition, the bank has secured the necessary regulatory approvals for raising funding from the market, through structured market instruments,” it said.

“The agro-bond instrument will be accorded prescribed asset status, highly liquid and enjoying tax exemption and will also have an attractive guarantee to the investors.”

Farmers are expected to start accessing the funding by the end of next month in preparation for the next summer cropping season, said the bank.

The bank expressed gratitude to the Government and monetary authorities for the timely provision of funding for the winter wheat programme.

“The pursuit of the mandate finds expression through the Ministry of Lands, Agriculture, Water, Fisheries and Rural Resettlement vision for Agriculture and Food Systems Strategy (2020-2025),” said the bank.

The strategy, which is a composite plan of action drawn from the Agriculture Recovery and Livestock Growth Plans was launched last August with the objective of achieving a US $8,2 billion agriculture economy by 2025.