Farmers and traders will be able to access short term loans in the form of warehouse receipt finance, in a bid to improve efficiency in the supply chain of farm products, Chase Bank has said.
The bank said that farmers and traders of wheat, maize, barley and sorghum will be able to secure the loans, after delivering and storing their grain in warehouses accredited by the East African Grain Council.
"Farmers and traders of grain produce can now store their commodities in warehouses approved by EAGC and use the warehouse receipts as collateral to obtain an upfront 65 percent financing from the bank," Chase Bank Head of Agri-business, Kathleen Goense said.
She added that the loan will enable farmers and traders to meet their immediate financial needs without reliance on selling their produce after harvest, so as to enable them to store and sell the produce later when the market prices are high.
Agriculture is a significant contributor to the Gross Domestic Product at 24 per cent and the warehouse receipts would be an excellent instrument in financing it, if the Warehouse Bill is put into law, Chase Bank said.