Chief Executive Officers for various cooperatives in the country wants government to establish a special agricultural cooperative Bank as one way of easing pressure faced by farmers while accessing loans.
Once established, the bank is believed to offer softer interest rates to farmers and by that improve their agricultural productivity as well as their livelihoods.
Community Savings and Investment Promotion (COMSIP) Executive Director, Tension Gondwe said through their organisation and also by working closely with communities particularly farmers, it is a proven fact that given an opportunity to own a bank, many farmers in the country stand a chance to progress in their farming business.
Gondwe said a lot of farmers in the country are failing to engage in serious business due to lack of financial resources as the only available commercial banks usually charge them higher interest rates.
Gondwe said as Comsip union, they have about 500 cooperatives with 160,000 farmers whose capital is in excess of MK3.8 billion.
“As a mother body of cooperatives I can confirm to you that farmers have money but they only lack a bank where to save their money and have flexible credit.
“Therefore, what we are asking from government is to continue enhancing commencement of the agricultural bank,” said Gondwe.
He said the introduction of the bank will also make farmers proud and thereby make them to effectively contribute to the development of the country.
Harrison Kaluwa Chief Executive Officer for Mzuzu Coffee Growers concurred with Gondwe that if Malawi as a country is to grow, there is need to embrace the cooperative model and open a bank specifically for farmers.
“Our economy is agro-based and what is important for us now is to find ways how to improve the sector. Some of such ways is by allowing farmers to work in groups and further introduce a bank specifically for them so that they can flexibly get loans and increase their productivity,” Kaluwa said.
He said as Mzuzu coffee they have the capacity to export their products to international markets their proceeds could have been used by other farmers if a bank was available.
Ministry of Finance Spokes person, Nations Msowoya assured of government’s commitment to have an agricultural bank.
Msowoya said currently government is conducting some studies and once completed, farmers will have their bank.
“I can confirm that indeed we need to have a bank for cooperatives since we for sure know that once established it will contribute to the growth of cooperatives in the country and add value to our economy,” explained Msowoya in brief.