Kenyan farmers claim they’re being forced to borrow loans under unclear repayment arrangements by county governments
An initiative the county government says it wants to use to help farmers sell their produce has raised a storm.
In the arrangement, the county has established a Sh5 million loans kitty which farmers are expected to borrow and use the money to build food stores in the wards.
Farmers would then be expected to deliver their produce to the central food stores in each of the 25 wards from where the government would collect and sell it on their behalf.
The programme groups farmers into what the county calls Multipurpose Saccos, through which they should take the loans reportedly administered by the K-Rep Bank. The Saccos are based in each ward.
FORCED TO BORROW
While most of the farmers welcomed the government’s move to help them market and sell their produce, they claim they are being forced to borrow loans under unclear repayment arrangements and this is what they are uncomfortable with.
Those who spoke to Nation claimed the initiative was started without consultations or agreement on who and how the loans will be repaid.
And Tuesday, the government confirmed existence of the initiative but claimed farmers were consulted before it was rolled out.
The farmers who requested anonymity for fear they may be victimised by authorities for challenging the programme said they don’t have to take the loans as they see a hidden agenda in the whole arrangement.
When called upon for comment, Agribusiness executive Alex Kirui directed the Nation to the department of Resource Mobilisation which he said is in charge of the loans.
Resource Mobilisation director Wesley Sigei defended the programme saying the government conducted adequate civic education and consultations before launching it last year.
“We floated the idea of loans because we felt some farmers may not be able to raise the cash needed for construction of the food stores,” Mr Sigei said.
He also defended the county’s decision to settle of K-Rep to give out the loans and not any other bank saying other financial institutions they approached were reluctant to partner with the county government.
“We approached several banks but only K-Rep agreed to work with us,” said Mr Sigei.
He added: “The programme is only meant to help farmers get market for the produce.”
Mr Sigei said the government would hold further consultations with the farmers who he exuded confidence will eventually appreciate the initiative.
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