Across the globe, there’s a growing recognition of the vital role sustainable agriculture plays in tackling key issues like food security, climate change, and rural development. This emphasis is especially pertinent in Africa, where agriculture is the backbone of many livelihoods. With its abundant agricultural potential, Nigeria grapples with challenges such as low productivity, the adverse effects of climate change, and limited financial access for smallholder farmers.
Research shows that agriculture contributes about 25 percent to Nigeria’s GDP and employs nearly 70 percent of the country’s population. However, farmers still struggle with low productivity, the adverse effects of climate change, and limited financial access for smallholder farmers. This isn’t any different in Enugu state as farmers are plagued by limited resources and access to financial services, making it even more challenging for farmers to adopt sustainable farming practices.
The challenge of limited access to finance presents a significant obstacle for smallholder farmers aiming to adopt and maintain agroecological practices. The Central Bank of Nigeria reports that 36% of Nigeria’s adult population has access to formal financial services. This financial exclusion significantly limits farmers’ ability to invest in quality inputs, sustainable technologies, and essential equipment needed for agroecology.
South Saharan Social Development Organization with support from ActionAid realizing this gap, established Village Savings and Loans Association, VSLA, in its three project communities: Umuogili, Oduma Achara, and Ihenyi to support young farmers. VSLA empowers farmers by offering a structured platform for savings, borrowing, and investment within their community.
Mrs. Lucy Odo, the Chairperson for Ihenyi VSLA group shared, “I am grateful to SSDO and ActionAid for this initiative. Getting loans from the bank is a long process for us, especially considering the distance. But with VSLA, I can access loans to start a poultry business.”
The groups have successfully drafted their constitution, ensuring structured and efficient operations. This includes membership criteria, savings and loan procedures, interest rates, repayment schedules, and conflict resolution mechanisms has also been clarified. The associations have collectively saved N375,000 since their inception and six people have accessed loans, a testament to their functionality and effectiveness in mobilizing local financial resources for agri-business.
“I have been wanting to expand my farm and cultivate more land to include new crops but funds have been a limiting factor. Now, I will be able to grow my business and increase my annual income.” Meschach Ayogu from Umuogili community shared.
