Micro-Financiers Ignoring Farmers, Says Poverty Body
Thursday, October 5, 2006
Micro-Finance institutions have been faulted for neglecting agriculture in favour of jua kali (informal sector) projects.
The Poverty Eradication Commission chairman, Dr Gilbert Oluoch claimed lending institutions targeting micro- and small scale enterprises were ignoring farming for fear of losses due to the current erratic rain patterns.
This, Oluoch said, had adversely affected economic development. The chairman was speaking during a monitoring and evaluation tour of some 13 projects funded by the poverty body in Koibatek district.
Oluoch said his commission was now working with insurance institutions on arrangements to provide risk cover to smallholder farmers.
“The Government is negotiating with insurance firms on new policies to accommodate smallholder farmers in a bid to alleviate poverty at the community level,” said Oluoch.
He also indicated that the commission was in the process of improving the Revolving Loan Fund Strategy to assist the low-income earners who cannot access credits from banks or the MFIs.
The loan fund is financed by the Government through a grant given to the commission. Funds are advanced to low-income groups through the District Poverty Eradication Committee, financial intermediaries and community groups.
Source: The East African Standard (Nairobi) (link opens in a new window)