National Agricultural Development Fund (Establishment) Act 2023

What Is This Policy?

The National Agricultural Development Fund (NADF) Act 2023 establishes a dedicated, long-term public fund to finance agricultural development across Nigeria. The Fund pools federal and state government contributions, development bank deposits, and donor resources to provide affordable credit, grants, and guarantees to farmers, agribusinesses, and agricultural infrastructure investors.

Who Does It Target?

Smallholder farmers who lack collateral to access commercial bank credit Agro-processors, food manufacturers, and value chain investors seeking long-tenor financing State governments funding irrigation, rural road, and post-harvest infrastructure projects Cooperatives, farmer groups, and agricultural commodity associations

What Does It Aim to Achieve?

Provide a sustainable, countercyclical funding stream for agricultural development that is not dependent on annual budget appropriations Reduce farmers' cost of credit by offering concessional interest rates below the commercial bank cost of funds Finance the infrastructure gaps in storage, irrigation, rural roads, and processing that constrain agricultural productivity Complement the Agricultural Credit Guarantee Scheme Fund (ACGSF) by providing direct lending and matching grant instruments

Key Features

Multi-Source Capitalisation: The Fund receives contributions from the Federal Government appropriation, state government allocations, Bank of Agriculture equity, and development partner grants Concessional Lending: NADF disburses credit at below-market interest rates through the Bank of Agriculture and licensed microfinance banks to qualifying farmers and agribusinesses Grant Window: A dedicated grant window finances non-revenue agricultural infrastructure, climate-smart adoption, and women and youth agri-enterprise start-ups Guarantee Facility: The Fund provides partial credit guarantees to commercial banks to crowd in private lending to agricultural clients who lack traditional collateral State Matching Mechanism: States that contribute to the Fund receive proportional access to credit lines for state-level agricultural development projects Independent Governance: The Fund is managed by an independent board chaired by the Central Bank Governor with representation from FMAFS, BOA, and the private sector

Current Status

Under consideration by the National Assembly. The National Agricultural Development Fund (Establishment) Bill is pending legislative approval.

Legal Framework

Bank of Agriculture Act; Agricultural Credit Guarantee Scheme Fund Act; Land Use Act 1978; Renewed Hope Agenda Agricultural Transformation 2023