Farmers selling their produce through the AHL Commodities Exchange will now have an opportunity to borrow from New Finance Bank (NFB) while waiting for an improvement in market prices, officials from the two institutions have confirmed.
This follows a Memorandum of Understanding (MoU) on Warehouse Receipt System the two signed on Tuesday in Lilongwe.
The system is expected to enhance the bank’s financial inclusion drive whilst providing an opportunity to farmers to dodge market pressures that determine undesirable prices.
AHL Commodities Exchange Managing Director, Davis Manyenje, said the development will ensure that farmers are not inconvenienced, especially when preparing for the next season.
“We want farmers that usually sell their products under panic because they need the money, especially during the harvesting period, to be able to hold back their commodity and sell when prices are right for them.
“Quiet often, farmers complain about the prices being unfair to them but usually, it is because of supply and demand factors during the harvest period. We are providing this product so that farmers can hold on to their commodities but still be able to get credit facilities from NFB,” Manyenje said.
NFB Chief Executive Officer, Zandile Shaba, said the move is in line with the mission of the bank to reach out to the unbanked.
“One of our missions in Malawi is to have a social impact on the communities that we serve and see them change to another level where they are economically empowered,” Shaba said.
She went on to say that the banks recent partnership with MyBucks has enhanced its presence in the country making it easy for farmers to access their products.
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