President dubs Demerara Bank’s Farmers Credit Line an “exceptional” initiative

Demerara Bank’s Farmers Credit Line is an important part of national development that will aid farmers in increasing their productivity, so says President Irfaan Ali.

Ali made this disclosure on Monday afternoon as he delivered the feature address at the launch of Demerara Bank’s Farmers Credit Line at the bank’s office in Mahaica. President Ali dubbed the initiative innovative and congratulated the bank and farmers who “have worked “tremendously hard in making this new direction and policy realised”.

The Head of State reminded of global issues, the impending food crisis, and the need to be prepared to “face the reality” and to develop the resilience to ensure Guyana remains in a position to feed the population.  “To approach this multifaceted problem requires not only the Government, it requires the farmers, it requires the traders, it requires the banking sector; it requires scientific research, it requires scientists, students. It requires all of us to join in the effort to combat the consequences of the coming global food crisis,” Ali said.

The President disclosed that one of the important investments that Government has to make as a country from the oil and gas revenue, is to improve and increase the productive capacity. “Unless we improve production at every single level and in every single sector, we will not be able to build a strong, resilient and diversified economy,” he said.  Ali stressed that to improve the production capacity requires improving productivity, increasing efficiency, and deploying capital in a more strategic way.

BUILDING A COMPETITIVE SECTOR

The President said that the formulation of consortiums also creates a vehicle for achieving economies of scale. He said this was exemplified by the coming together of the poultry farmers to provide the corn and soya requirements for the poultry sector, which will then be expanded to the wider livestock sector and the CARICOM region. “So what I have advised the Agriculture Ministry to do is to work in a manner in which we can bring farmers together in consortiums…and here is where the banking sector comes in,” he said.

Ali pointed out the importance and impacts of the Government working in tandem with the financial institutions to provide more capital to farmers, which will, in turn, increase productivity. He stressed that coming together can increase the pool of finances, which in turn can result in larger investments, especially in the long term. Ali disclosed the importance of technology transfer, new markets and access to new markets.  He noted that these are the reasons the Government is approaching the issue of food production from many points and have diversified investments in infrastructure, drainage, and irrigation and in working with communities. More importantly, he added Government is working towards removing the barriers that exist simultaneously.

“In the last two years, there is no other Government globally, and I can say this with the greatest confidence, there is no other Government globally that per capita has invested and supported agriculture, mining, fishing services industry and construction, vulnerable group, livestock and poultry farmers more than the Government of Guyana. That is a fact. That is a fact if you look at it per capita,” Ali explained.

LEADING THE CHARGE

The President said that Demerara Bank has demonstrated leadership and has simplified the process of accessing capital. “You have not only simplified the process, but you have removed the charges, you have removed the fees; you have removed the need to bring 10 years of financial statements. The second issue is mitigating risk. How do we ensure that we mitigate risk? And you’re doing that by not only lending the farmers, but working with them in the management process, holding their hands and supporting them through the management process, another big factor in what you’re launching,” Ali argued.

The President, at the launch, also encouraged the financial institution to reduce their interest rate by 1%, and CEO Pravinchandra Dave immediately agreed. “That is a responsible bank,” President Ali declared. Moving forward, he said the need for all parties “to work together”. Ali appealed to the recipients in closing, not to misplace the trust and confidence placed in them by the financial institution.

Demerara Bank has received 193 applications to the tune of $200m, to date. Agriculture Minister, Zulfikar Mustapha, who was also at the launch, dubbed it an “achievement in agriculture financing”. He revealed that the lack of collateral requirement is one of the key features of the Farmers’ Credit Line. “Today, we are witnessing a new dimension of loans”, he said.

It was revealed that with the revolution in the country’s agriculture sector, this initiative, will “bridge the cash flow gap” which exists. The bank’s Marketing Manager Christina Correia explained that management met with farmers over the last few weeks, listened to their challenges, and then tailored a product with them in mind. The CEO pointed out that the recently held Agri Investment Forum and Expo was “timely”. He endorsed that equal importance is being given to the agriculture sector as oil and gas.

He pointed to the rising prices for food and the great challenges being faced globally. CEO Dave also noted that banks are not doing enough for the agriculture sector and do not see the priority of the sector. Dave stressed that this “hassle-free” initiative, will be launched in other areas across the country. He said that the initiative, which caters to the rice sector at this time, is designed to cater to the cycle of farmers’ income.

“We are fully committed”, CEO Dave declared.