Crop Value Chains as Pilots
NIRSAL has identified six pilot crop value chains based on existing crop production levels and potentials in six high-potential breadbasket areas. The crops are:
- Tomatoes
- Cotton
- Maize
- Soya beans
- Rice
- Cassava
Core NIRSAL Targets
NIRSAL has four concrete and transparent measures of success for the financial value chain:
- Leveraging of NIRSAL fund to USD3 Billion to increase bank lending within ten years in order to increase bank's total lending to agriculture from the current 1.4 to 7 percent.
- Increased lending to the "pooled" small farmer segment to 50 percent of total lending to agriculture. Typically, banks do not reach producers individually but through "pools" such as MFIs and cooperatives).
- Increased lending to agricultural primary producers by 3.8 million in 2026 through pooling mechanisms such as value chains, MFIs and cooperatives.
- Reduction of bank's break-even interest rate to borrowers from 14 to 7.5 - 10.5 percent.
Economic Benefits of NIRSAL
- Generate higher income, GDP, foreign exchange earnings: They will also lead to increased income, GDP, foreign exchange earnings and the ability of the Central Bank of Nigeria to manage the value of local currency, lower food inflation and maintain monetary robust external reserves as well as monetary stability. In addition, the project will absolve the Bank of the need for endless and voluminous subsidies to the agricultural sector.
- Strengthen the financial sector: NIRSAL will strengthen the Nigerian financial sector because it presents an opportunity for the banks to capture latent profits in agricultural lending, maintain long term human, institutional and cultural capacity for value chain financing capacity and enjoy lower loan origination and distribution costs.
- Boost farmers and other agricultural producers: NIRSAL's interventions will benefit Agricultural producers via increased access to credit, enhanced adoption of better cultural and agronomic practices, use of improved inputs like seeds and fertilizers, increased productivity and profit, income, standards of living, job creation and poverty reduction.
- Enhance food security and facilitate higher productivity: NIRSAL's interventions will lead to a stronger agricultural sector with six showcase value chains, enhanced food security, fewer imports, and higher productivity.
- Fundamentally transform the Nigerian economy: Overall, NIRSAL will help to realize a stronger, more diversified, post-oil economy with additional agricultural GDP growth, higher employment, reduced expenditure on food imports, higher tax revenue from the agricultural sector, competitive exports and a more diversified economy.