Bank of Agriculture Secures $1 Billion Fund to Support Smallholder Farmers

The Bank of Agriculture (BOA) has secured a $1 billion intervention fund to strengthen smallholder farming in Nigeria and improve the agricultural value chain from production to market access.

The fund, obtained through a strategic partnership with the African Export-Import Bank (Afreximbank), is expected to boost national food security, expand agribusiness opportunities, and promote inclusive economic growth.

This initiative follows the approval of the National Food Security Fund by President Bola Ahmed Tinubu, designed as a revolving matching fund in collaboration with state governments.

National Smallholder Farmers Fund

The newly created National Smallholder Farmers Fund aims to remove financial barriers that have historically hindered Nigerian farmers. The fund will provide affordable loans for essential inputs, mechanization, and market linkages.

Smallholder farmers produce over 90% of Nigeria’s food but often face challenges in accessing finance, modern technology, and reliable markets. The intervention seeks to bridge these gaps, enabling farmers to increase productivity and play a more active role in both local and continental supply chains.

BOA’s Managing Director and CEO, Ayo Sotinrin, described the initiative as a bold commitment to achieving food security:

“By partnering with Afreximbank, we are creating opportunities for smallholder farmers to move beyond subsistence farming into sustainable agribusiness.”

Similarly, Mrs. Kanayo Awani, Executive Vice President for Intra-Africa Trade and Export Development at Afreximbank, emphasized that smallholder farmers are crucial to the agro-industry and national economic growth.

How the Fund Will Work

The agreement includes two financial mechanisms designed to ensure efficiency and sustainability:

1. Guarantee Framework – Afreximbank will provide guarantees on BOA loans, reducing risks and expanding access to finance for underserved farmers.
2. Currency Swap Arrangement – Dollar-denominated funds will be converted into local currency, allowing BOA to lend directly to farmers while shielding them from exchange rate volatility.

This structure not only gives BOA access to international capital markets but also protects farmers from macroeconomic shocks that could affect their progress.

A Path to Food Security and Inclusive Growth

With this intervention, Nigeria is expected to unlock the full potential of its agricultural sector, empower millions of rural farmers, and strengthen the economy.

The initiative marks a new era for Nigerian agriculture, positioning smallholder farmers as active contributors to national food security and regional trade development.