Farmers contracted under CBZ Agro-Yield will soon be paid in US dollars after the bank was given approval by the Ministry of Finance and Economic Development to buy their harvests in foreign currency, CBZ Agro-Yield managing director Mr Walter Chigodora told Parliament last week.
CBZ Agro-Yield is a subsidiary of CBZ Holdings.
Mr Chigodora told the Senate Thematic Committee on Peace and Security that the development will provide a relief to farmers who were struggling to repay their loans after inflation eroded their earnings.
“As we talk right now we are in a process that will end with the signing ceremony. We recently were given approval so we can buy our own produce and we are in the process, the mop up process, and we will pay our farmers in US dollars just like private competitors are doing,” Mr Chigodora said.
He admitted that some farmers were defaulting on their obligations due to the erosion of their earnings by high inflation.
The company has partnered Government through the Ministry of Finance and Economic Development and the Ministry of Lands, Agriculture, Fisheries, Water and Rural Development, along with other stakeholders in the National Enhanced Agriculture Productivity Scheme that was set up to ensure food self-sufficiency in Zimbabwe through the support of wheat, maize and soya bean production.
CBZ Agro-Yield distributes inputs to those farmers that meet the company’s requirements with regards to repayment capabilities and production capacity.
Appearing before the same committee, AFC Holdings group chief executive Mr Francis Macheka said it was imperative that the bank obtained Government funding for onward lending to farmers at concessionary interest rates.
“We hope and pray that we get proper funding so that we can give appropriate development funding to our farmers,” he said.
CBZ was currently getting the bulk of their funding from pension funds and insurance which were expensive for farmers.
The AFC Holdings subsidiary, AFC Land and Development Bank, is responsible for supporting farmers to increase their production and productivity.
The Bank supported wheat production on 11 000ha this past winter season.