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By Yewande Ogunojemite


The etymology of bank connotes an institution promulgated in accordance with the lay down rules and regulation of a sovereign political independent entity and saddled with the major responsibility of keeping peoples deposit towards profit maximization.

Institutionally, apart from bank of Agriculture, there are other various banks saddled with the responsibilities of savings and lending in the international financial market such as; Central Bank, Commercial Bank, Bank of Industry, Mortgage Bank etc.

The Central Bank of Nigeria (2014) defined the Bank of Agriculture (BOA) as a type of bank that lends money to farmers for longer periods of time and charges them less interest than other types of banks.

In his words, Adesina (2012), an Economist and Social Commentator succinctly conceptualized Bank of Agriculture as bank that lends money to individuals, basically farmers, often over a long period of time and at low rates of interest.

Therefore, i can fundamentally and without prejudice, describe the Bank of Agriculture as a credit bank expressly established in accordance with the provisions of law to assist agricultural development across the globe, particularly by granting loans for longer periods than is usual with commercial banks.


The Bank of Agriculture, formerly known as the Nigerian Agricultural Cooperative and Rural Development Bank (NACRDB) was incorporated as Nigerian Agricultural Bank (NAB) in 1973 and in 1978, was renamed Nigerian Agricultural and Cooperative Bank (NACB).

Subsequently in 2000, it was merged with the People’s Bank of Nigeria (PBN) and took over the risk assets of Family Economic Advancement Programme (FEAP) to become Nigerian Agricultural Cooperative and Rural Development Bank Limited, a name that has always be considered too long and unwieldy.

It was renamed Bank of Agriculture (BOA) in 2013. This according to the Managing Director of the Organization, Mohammed Santauraki follows the requisite administrative and regulatory approvals from the Fedeeral Ministry of Agriculture and Rural Development which supervise the agency in conjunction with the Federal Ministry of Finance and Central Bank of Nigeria (CBN).

BOA was designed for Nigerian farmers on the need to improve access to finance, and effectiveness of agricultural and rural development in view of the importance of these sectors to national development because the sector is too important to be left to private sector finance institutions alone.

According to the National Bureau of Statistics (NBS), agriculture, either through subsistence or mechanized form, is the largest employer of labour and also the largest contributor to the national GDP in Nigeria (42%).

However, agricultural credit as a percentage of banks’ total credit in Nigeria was 1.4% (2011) and has averaged 2.4% over the last three years. That is practically 60% of the population getting only 2.4% of the “national finance pie”.

There lies the challenge which the Bank of Agriculture is repositioning itself to bridge. Bank of Agriculture is the Nigeria’s apex agricultural and rural development finance institution.

As a development finance institution, it is government owned (CBN 40% and Federal Ministry of Finance 60%), and supervised by Federal Ministry of Agriculture.

Simply put, BOA is Nigeria’s premier agricultural and rural development finance institution, 100% wholly owned by the federal government of Nigeria. The ownership structure is – Central Bank of Nigeria (CBN) 40% and Federal Ministry of Finance Incorporated 60%.

Bank of Agriculture Limited is supervised by Federal Ministry of Agriculture. The Bank was incorporated as Nigerian Agricultural Bank (NAB) in 1973 and in 1978, was renamed Nigerian Agricultural and Cooperative Bank (NACB).

As earlier stated in this paper, a strategic plan to reposition the Bank into an effective and sustainable national agricultural and rural development finance institution in 2010 led to a further name change to Bank of Agriculture Limited (BOA).

It is a federal government owned development bank with a mandate to provide low cost credit to small holder and commercial farmers, and small and medium rural enterprises. It also provides micro financing to small and medium scale non agricultural enterprises (Davies 2014).

The aim is to ensure effective delivery of agricultural and rural finance services on a sustainable basis to support the national economic development agenda, including food security, poverty reduction, employment generation, reduction in rural to urban migration, less dependency on imported food items, and increase in foreign exchange earnings, Davies, 2014 further stated.

Furthermore, BOA has an effective system of sustainable agricultural financing services that strengthens agriculture’s specific role in the economy to provide adequate food for Nigeria’s increasing population, supply adequate raw materials to a growing industrial sector, deliver a reliable source of employment, ensure generation of substantial foreign exchange earnings and provide a market for the products of the industrial sector.

In ensuring the provision of food, BOA is targeted is to provide small farm holder loans to drive production of cash crops, staple foods, livestock and fisheries.

The ultimate goal of BOA is to elevate agriculture to enterprise level so as to build lives and communities, one life at a time.

This approach to empowerment is also available to non-agricultural small and medium enterprises at all local communities in Nigeria.

Bank of Agriculture has a team of experienced agriculturists, agriculture extension officers and qualified technicians that train and expose farmers and artisans in modern and best trade practices to encourage productivity.

Some of BOA’s agricultural training is designed to enhance farmers’ entrepreneurial skills and educate them on how to source for profitable markets for their produce.

Most of BOA’s modules are aimed at enhancing economic empowerment of farmers and other small business owners in rural settlements through active participation.

The tasks of BOA, as stated by the Central bank of Nigeria, Federal Ministries of Finance and Agriculture are as follows;

1. Credit Task
2. Developmental task

Bank of Agriculture credit functions are activated at the level of direct Lending, on-lending, collaboration, and monitoring of credit.

This activity involves:
1. Direct lending to qualified loan applicants engaged in agricultural and non agricultural small businesses
2. Providing credit facilities to issuing organizations through our on-lending service
3. Monitoring the flow of ground level rural credit

Credit is a critical factor in development of agriculture, the rural areas, and small business in general. This is because it drives capital formation and technology upgrade.

Bank of Agriculture activity in this area involves the direct making of loans and strengthening of local micro finance banks, which deliver credit at the local community level.

The bank, according to its 2015 financial year position mandate has embarked of various initiatives to strengthen the cooperative credit structure at local and state government level as well as rural micro finance banks. The effect is that adequate and timely credit is made available to the needy.

Consequently, in order to reinforce the credit functions and to make credit more productive, Bank of Agriculture is currently into the implementation of a number of developmental and promotional activities such as:-

1. Work with cooperative groups at the states and local government level to prepare development action plans for themselves.
2. Enter into collaborative or on-lending Memorandum of Understanding (MoU) with state governments and cooperative associations and micro-finance banks specifying their respective obligations to improve the affairs of the groups and banks within a stipulated time-frame.
3. Monitor implementation of development action plans of cooperative associations and micro finance banks and fulfillment of obligations under MoUs
4. Provide financial assistance to cooperatives and micro finance banks for establishment of technical, monitoring and evaluations cells.
5. Provide organisation development intervention (ODI) through reputable training institutes like Federal cooperative colleges, Universities of Agriculture, and departments of agriculture of various universities in Nigeria.
6. Provide financial support for Federal Cooperative colleges and departments of cooperative studies in various universities and polytechnics.
7. Provide training for senior and middle level executives of local commercial bank branches, micro finance banks and cooperative associations.
8. Create awareness among the borrowers on ethics of repayment through local debt collectors and cooperative marshals that enforce timely repayment and prompt remittance of same to the lending institution.
9. Provide financial assistance to microfinance banks for building improved management information system, computerisation of operations and development of human resources.

In addendum to the foregoing, BOA declared the underneath accomplishments in its 2015 financial year module;
Bank of Agriculture has disbursed –
1. N41 billion to over 600 enterprises across Nigeria in the last 10 years
2. N3 billion on-lending facilities to about 12 states of the federation
3. N4 billion to about 30,000 beneficiaries

The beneficiaries were sourced from:
1. Collaboration with 30 institutions
2. 1.8 million account holders

BOA has also engaged in:
1. Capacity building activities for about 2,000 executives selected from 600 cooperatives
2. Strengthening of market information
3. Agriculture Extension and Advisory Services


The Federal Ministry of Nigeria (2010) listed the following as the fundamental products and essential services of BOA;

(1) Credit Services
(i) Micro Loans Scheme

The Bank provides credit to finance both micro agriculture and micro non-agricultural activities. This loan can be accessed by traders, artisans, arable/field crops farmers, fish farmers, agro-processors, livestock farmers, agricultural produce marketers, tree crop farmers as individuals, Cooperative groups, Self-help groups etc.

(ii) SME/Agribusiness Loans Scheme
This Loan Scheme is for financing small, medium and large scale agribusinesses projects across the Agriculture Value Chain.

(iii) On-Lending Loan Scheme
This is a relationship through which the Bank partners with States, Local Governments, Agricultural Financing Agencies, Non-Governmental Organizations (NGO), Community Based Organization (CBO), Self Help Groups (SHGs) etc. to reach to larger segment of Nigerians especially the underprivileged and rural poor with micro credit for enterprise development.

(iv) Bank of Agriculture Rural Business Initiative (BoARBI)
The Bank of Agriculture as a Development Finance Institution is committed to serving the rural sector with its existing network of over 136 operational outlets where it enjoys direct outreach to more than 350,000 microfinance clients, mused different options for strengthening its direct microfinance portfolio with a model that focuses on the market layers located below its current direct microfinance market by targeting households whose entry level loan requirements range from N 20,000-N30, 000.

BoARBI model is aimed at meeting the forgoing desire by ensuring that sustainable microfinance services are available to households at the bottom layers of the rural microfinance market and aims at reaching around 1 million households in this market segment throughout Nigeria over a 10 year period. BoARBI will enable BOA to demonstrate its ability to attain high level self-sustainability and thus become the platform for offering scalable and sustainable financial services to the bottom layer of the rural microfinance market.

BOA Greencash is a mobile payment service of the Bank. Its features include the following:
(i) A standalone wallet linked to a mobile phone.
(ii) A channel for the Bank customers to access bank services on the go.
(iii) Can be used to make withdrawals, buy airtime, balances inquiries, send money, apply for loan, obtain mini bank statements and pay bills such as electricity, DSTV, water rates etc.
(iv) Can be acquired by existing and new BOA customers as well as non-BOA customers.
(v) Can be accessed via dial-up, SMS, Web and USSD

Ogunojemite is an Agriculture Graduate Research Student at the Premier University of Ibadan, Ibadan, Oyo State, Nigeria. She can be reached via

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