Co-operative Bank of Kenya has signed a US $4.6Bn financing deal with fertiliser Company Yara East Africa Limited. This is aimed at facilitating Yara fertiliser distributors across the country with a dedicated kitty to support the purchase and restocking of their outlets.
According to media reports, the Distributor Finance Scheme launched earlier this week is a five-year partnership that kicked off with US $571,847.39 released to the Yara fertilizer distributors who have already applied for the scheme. The Distributor Finance Scheme is projected to enhance fertilizer access by farmers hence boosting the much-needed food production in the country.
This financing program will enable farmers to access the various Yara fertilizer brands with ease. This, in turn, will boost fertilizer use to increase soil fertility and thus promote an increase in food production across the country. William Ng’eno, the Yara Country Manager for Kenya said that the scheme aims to enable distributors to increase their stock to meet the high demand for fertiliser during this short rain planting season and beyond.
Similarly, Co-op Bank’s Ag Director Corporate and Institutional Banking, Jacquelyne Waithaka echoed Mr Ng’eno’s sentiments, adding that the Finance Scheme will help distributors of Yara fertilizers to maintain their desired stock levels for fulfilling the requirements of their customers. This, she explains, will enable them to thrive in the marketplace. The distributors can borrow up to a maximum of Sh20 million to finance the purchase of their fertilizer stocks.
Furthermore, the distributors will enjoy negotiated banking terms, with a disbursement fee of 2% being the only charge. This is in addition to an overdraft with an expiry period of six months and payment upon utilisation of the overdraft due in 45 days.