Rice farmers react to Premium Times’ report on Anchor Borrowers’ Programme

Healthy rice paddy, Jega
Healthy rice paddy, Jega

Following the publication of a special report on the Federal Government’s Anchor Borrowers’ Programme, on June 4, 2018, PREMIUM TIMES received a letter of complaint from the Rice Farmers Association of Nigeria (RIFAN) claiming that the story contained “misinformation, inaccuracies and unfair generalisations.”

RIFAN then listed eight findings in the story, which it claimed were not correctly portrayed or false.

RIFAN’s full statement is published below.

However, PREMIUM TIMES responds to each of the “allegations” raised by RIFAN in the story as follows:

  1. Fake Farmers and Political Patronage

RIFAN claimed that due to the rigorous requirements and process involved before a farmer is given farm input, it is “virtually impossible” for someone, without a farm to be given the inputs.

PREMIUM TIMES suspects that this allegation could as a result of a hasty reading of our story. Our story did not make such claim about the RIFAN model of the ABP.

We want to point out that there are two main models of the ABP – the government run model and the RIFAN model. According to our story, it was the government’s model (the original ABP) that was fraught with allegations of fake farmer, political patronage and unpaid loans and not the RIFAN model.

In fact, a different segment of our story tagged: “RIFAN Model” was dedicated to reporting the organisation’s model of the ABP and our story categorically stated that this model does not involve the distribution of money to beneficiaries. There was no part of that segment that directly accused RIFAN or suggested that RIFAN gave inputs to fake farmers or used the programme as repayment for political patronage. We call on officials of RIFAN to read our story again to be sure of the distinction therein between the association’s model and that run by state governments.

  1. Bad Loans, Diversion of Funds

Again, RIFAN made the mistake of confusing the distinction between its own model and the government model. In fact, we find this particular complaint curious.

We wonder why RIFAN, whose model does not involve the disbursement of cash to farmers, as clearly stated in our story, is worried about bad loans and diversion of funds. We wonder why RIFAN is speaking in defence of the state government’s model which it was not involved in.

However, it is important to address this complaint further. RIFAN’s claims that the ABP was implemented in 36 states of the federation is false. The original government run model of the ABP was mainly implemented in the north of the country. In fact, it was not done in Ebonyi State, arguably the largest rice growing state in the south of the country.

It was the RIFAN model which was implemented across the country and not the original federal/state government run model. Again, we wonder why RIFAN is acting like the ‘advocate’ of the government instead of taking credit for spreading the programme across the country.

RIFAN also claimed that the sample states covered by our story are not enough to claim that there were diversion of funds and bad loans. A simple Google search will reveal that in virtually all the states where the federal government run ABP was implemented, majority of the beneficiaries did not repay the loans and in some states, the police were used to arrest defaulters and some of them were jailed.

  1. Supply of Expired Herbicides and Bad Seeds

RIFAN claimed that our story “omitted to state factually that all expired and bad inputs were replaced by the suppliers”. This claim is absolutely false.

In fact, we wonder if the association is not being deliberately mischievous by making this claim because this really goes beyond hasty reading of the article.

We find it incredible that RIFAN missed this paragraph from our story:

“At the warehouse of the Ekiti State Agricultural Development Programme at the Odo-Ado area of Ado Ekiti, I witnessed cartons of expired herbicides being replaced. Mr Rotimi said that was the second replacement within a month after the first replacement was discovered to be even more dated than the original herbicide supplied.”

Also, we did not only publish a picture of one of the suppliers replacing the expired herbicide, we also published the explanation of Segun Atho, the Deputy National President of RIFAN about the expired herbicide, where he claimed that they have been replaced by genuine ones. We are at a loss of what else RIFAN expected us to do in this instance.

  1. Money Ferried in Bullion Vans, Handed Over to Farmers in Cash

We did not say this happened in the RIFAN model of the ABP. How could we, when we categorically stated in the story that its model does not include cash disbursement?

Yes, money was ferried in bullion vans to pay farmers in cash. The Kebbi State officials we spoke with did not deny that this happened. Again, it was Mr Atho who first made this claim during our interview in Badagry and our investigation revealed that it actually happened. We are at a complete loss at why RIFAN is making this an issue.

  1. ABP Loan as ‘National Cake’

This has been comprehensively addressed in 1 and 2 above.

  1.  ABP, Exclusively Implemented in the North

This has been addressed in 2 above but we must also add that it was Mr Atho who first made this claim when we interviewed him at Badagry. We have him on record.

  1.   “I didn’t Get Anything from the Government”

The ABP was targeted at smallholder farmers. The farmers we interviewed are in the predominantly rice-planting town of Jega. In fact, we spoke to them in their farms.

We find RIFAN’s claim of “shopping for sound bites and working towards a predetermined verdict,” ridiculous, at best.

  1. Overpriced Inputs, Services

This was a claim made by a beneficiary and fair reporting mandates that this be included in our story. We also made attempts to balance this by asking Mr Atho about this allegation and his comment was included in the story.

Read RIFAN’s full statement as sent to PREMIUM TIMES below.

RE: Fraud Allegations, Unremitted Loans, Crop Failure, Other Anomalies Dog Nigerian Government’s “Rice Revolution”

The attention of the Rice Farmers Association of Nigeria (RIFAN) has been drawn to a Special Report with the above caption published by Premium Times, a reputable and respectable online newspaper, in its Monday 4th June, 2018 edition. The report contained several allegations against the Anchor Borrowers’ Programme (ABP) initiated by the Federal Government of Nigeria through the Central Bank of Nigeria (CBN) and disbursed through Participating Financial Institutions (PFI).

We would have preferred to stick to our occupation of rice farming, especially now that our busiest period, the wet season, is already at hand and allow journalists and professional critics to do their jobs. We are, however, constrained, as stakeholders and direct beneficiaries of the Anchor Borrowers’ Programme, to put up this advertorial in order to correct some of the misinformation, inaccuracies and unfair generalizations contained in the report, so the public may be better informed.

We state categorically, without any fear of contradiction, that the Anchor Borrowers’ Programme is nowhere near what the Premium Times report describes as a failure, no matter how defined. If anything, the Anchor Borrowers’ Programme is the best thing to have happened to our business as rice farmers. It is also the best structured, best managed and so far, most successful agricultural financial intervention Programme in Nigeria, if not in Africa. We have facts and figures to back this assertion.

How the RIFAN-ABP Works

It is important to describe briefly how the RIFAN Anchor Borrowers’ Programme works:

  • The RIFAN-ABP is a technology driven process that ensures full traceability of participating rice farmers, eliminates adverse selection of farmers and moral hazards in loan repayment. The Model also effectively tracks distribution of inputs and eliminates issues of ghost farmers collecting inputs.
  • The process commences with RIFAN submitting an Expression of Interest to CBN to participate in the Programme with a detailed Economics of Production, according to approved requirements and guidelines.
  • On approval, RIFAN is requested to submit its list of farmers to the CBN. Each farmer on the list must belong to a cluster and be identifiable through his/her Bank Verification Number (BVN). Those without BVN are required to obtain one or be dropped from the Programme. CBN will not support any farmer without a valid BVN
  • Next, the farmer’s land is mapped by independent Technology Service Providers using GPS technology to determine the size of the farm, as the ABP loan is a function of farm size. This also ensures that only genuine farmers with accessible and cultivatable land benefit from the Programme.
  • Thereafter, the farmer’s picture and biometric data are collected to ensure traceability before the PFI proceeds to open an account for the farmer
  • All participating farmers are then issued bar-coded electronic card which contains the farmer’s data – name, address, picture, biometric capture, GPS farm map and exact size of farm, BVN, account number and exact amount of inputs to match size of farm. It is this bar-coded card which the farmer uses to collect inputs for his/her farm.
  • No farmer can receive any inputs under the RIFAN-ABP without the bar-coded electronic card. Since the RIFAN-ABP loan is essentially in form of inputs, the cards effectively eliminate the issue of ghost farmers collecting inputs, farmers not getting the right amount of inputs or collection of inputs by proxy.
  • With technology to simplify the process, RIFAN, CBN and the PFI have access to an electronic dashboard provided by the Technology Service Providers to track input distribution to farmers using the bar-coded electronic cards.
  • The RIFAN-ABP, as with the other ABP models, is primarily targeted at smallholder rice farmers who cultivate between 0.5 hectares to 5 hectares of land only.
  • RIFAN acts as the Anchor to protect the interest of the participating farmers. The harvests are aggregated, warehoused and sold to Rice Millers on behalf of the farmers at market determined prices. The proceeds are paid into the participating farmer’s account to repay the loan.
  • Under the RIFAN-ABP, no cash is disbursed to any farmer. On the contrary, service providers for farm clearing, mechanisation, ploughing and combined harvesting are engaged. With the economics of scale, the farmers are able to get a good price rather than dealing with service providers individually.
  • Finally, a Project Management Team (PMT), made up of RIFAN, CBN, PFI, NAIC, Service Providers and Input Suppliers is constituted to provide oversight in each of the participating states.
Allegation No.1: Fake Farmers and Political Patronage

Given the rigorous nature of the requirement for accessing the farm inputs under the programme, it is virtually impossible to give these inputs to someone who does not have a farm or a bar-coded electronic card. Since the programme is largely cashless, there is no incentive for any person to collect inputs and not be able to use them. Yet, we cannot completely rule out the possibility that a comparatively insignificant number of ineligible persons could, for whatever inexplicable reason, have been smuggled into the programme by self-serving officials at inception but it is false to claim that the programme has been hijacked by politicians as a means of political patronage. The truth, however, is that at no other time in the history of Nigeria has a large number of ordinary farmers (rice, maize, cassava, groundnut, soya, cotton, wheat) benefitted so much from a government-sponsored programme. We remain grateful to the federal government for initiating a Programme of this nature, targeted at smallholder farmers.

Allegation No. 2: Bad Loans and Diversion of Funds

To say the programme has run into troubled waters in several states is, at best, an unfounded and unfair generalization or, worse, unprofessional and desperate sensationalism. Premium Times had acknowledged in the report that it conducted its ‘investigation’ in five states of the federation, namely, Lagos, Ekiti, Kebbi, Kaduna and Ebonyi, whereas the Anchor Borrowers’ Programme has been implemented in all the 36 states of the federation and the FCT, while the RIFAN-ABP Dry Season pilot was implemented in 25 states and the FCT, covering all the six geo-political zones of Nigeria. By all reasonable standards, five out of 36 states cannot provide a good basis for the kind of generalization replete in the Premium Times report, even if the allegations reported in all the five states are granted as true.

Allegation No. 3: Supply of Expired Herbicides and Bad Seeds

While it is true that under the RIFAN-ABP, there were a few complaints about expired herbicides and bad seeds supplied in Ekiti and Ebonyi States by unscrupulous input suppliers, once these complaints were received, the erring suppliers were directed to withdraw the bad products and replace them with good ones. They were also blacklisted from participating in the programme in future and were not paid for those bad products. Measures have since been put in place to ensure this kind of infraction does not happen again. It is worthy to note that the Premium Times article omitted to state factually that all expired and bad inputs were replaced by the suppliers

Allegation No. 4: Money Ferried in Bullion Vans and Handed Over to Farmers in Cash

There is no cash disbursement under the RIFAN-ABP model as all disbursements are in-kind in form of Inputs. However, the amount for cash disbursement under the State window usually constitutes a small percentage of the total loan amount, to enable farmers pay for labour towards land preparation. While, it is true that on commencement of the programme in Kebbi in November 2015, physical cash was handed over to participating farmers, this happened only during the pilot, since then over N80 billion has been disbursed under the programme in all the 36 states and the FCT without any physical cash being handed over. With technology, the usual practice is for any cash component to be paid directly into the farmer’s account.

Allegation No. 5: ABP Loan as National Cake

Just because a few bad apples have decided not to repay the loan is not a true reflection and is indeed a very bad generalization of all the genuine hard working smallholder farmers in the country. RIFAN farmers have no incentive not to repay the loan, partly because return on the loan is quite high but also because penalty for default is even higher. RIFAN farmers are quite aware that not being able to repay the loan has dire consequences, least of which is to be blacklisted from participation in future programmes.

Allegation No. 6: ABP Was Exclusively Implemented in the North

This statement is not only preposterous but far from the truth. While it is a known fact that the ABP was launched in Kebbi State, the Programme has been replicated by the CBN across all the states of the federation including the FCT. While the RIFAN-ABP Dry Season pilot was implemented in 25 states plus the FCT, it is anticipated that the upcoming wet season cultivation will be implemented in all the states of the federation.

Allegation No. 7: “I didn’t Get Anything from the Government”

This is what happens when a reporter is shopping for sound bites and working towards a predetermined verdict. It does not require a lot of effort or intelligence to understand that the person quoted above is not a participant in the Anchor Borrowers’ Programme. He is not a beneficiary and therefore not entitled to collect farm input.

Allegation No. 8: Overpriced Inputs and Services

The issue of price of farm input is a very straightforward one. Like everything else, prices of farm input are market-determined and provided in the Economics of Production at the planning stage to take care of all costs and contingencies such as logistics into account. Other things being equal, prices tend to remain the same by the time actual procurement takes place but occasionally price movement does occur either way.

Benefits of the CBN Anchor Borrowers’ Programme

In conclusion, there is no gainsaying that the awareness and massive production of homegrown rice is as a direct result of the Anchor Borrowers’ Programme. From our estimates, we will have moved from an annual production figure of about 4.5 million tonnes of rice in 2015 to about 8 million tonnes by the end of the wet season in 2018. By the end of the 2018/2019 dry season, we anticipate that 100% local rice demand will be from homegrown rice.

Due to the ABP, productivity per hectare had also improved from an average of 3 to 6 tonnes/hectare. Efficiency and cost of production per hectare is gradually improving as well. Across the entire value chain, with over 100,000 hectares cultivated during the RIFAN ABP Dry Season Pilot, we have created about two million direct and indirect jobs. RIFAN farmers are already on course to put another 500,000 hectares to good use during the upcoming wet season under theRIFAN-ABP.

We recommend that interested listeners, who want to hear from genuine beneficiaries of the Anchor Borrowers’ Programme, should listen to the report of the town hall meeting held in Kebbi on Friday, 1st June 2018 and aired on BBC Radio Hausa Service.

Finally, to avoid such misinformed reporting in the future, RIFAN is already preparing a documentary to showcase the entire RIFAN-ABP Dry Season Pilot across all the participating states, showing the entire processes, from GPS farm mapping, biometric data collection, issuance of bar-coded electronic cards and seamless input distribution process to genuine hard working smallholder rice farmers.


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