Govt agencies sign MoU to expand agricultural machinery leasing

Nigeria's quest for food security has received a boost with the signing of a Memorandum of Understanding between the Equipment Leasing Registration Authority (ELRA) and the National Agricultural Development Fund (NADF). This collaboration aims to significantly expand farmers' access to essential agricultural machinery through structured leasing arrangements.

The agreement, signed in Abuja, will facilitate improved access to vital equipment such as tractors, harvesters, and irrigation systems for farmers, cooperatives, and agribusiness operators. ELRA's Registrar/Chief Executive Officer, Donald Wokoma, explained that the partnership establishes a framework for offering affordable access to machinery via various leasing structures. These include finance leases, operating leases, and lease-to-own options, all compliant with the Equipment Leasing Act.

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ELRA will oversee the registration of lease agreements, maintain records of agricultural equipment under lease arrangements, help in structuring tailor-made lease models that will take due cognisance of the nature of agriculture, and support compliance with leasing regulations.

Wokoma highlighted that the initiative directly addresses the persistent financing constraints hindering farmers' adoption of mechanized equipment. It also seeks to stimulate greater private sector participation in agricultural leasing and equipment financing. ELRA will manage the registration of lease agreements and maintain records of leased agricultural equipment, while also developing tailored lease models suitable for the agricultural sector and ensuring regulatory compliance.

The NADF will provide crucial advisory support and facilitate capacity-building programs focused on the operation of agricultural equipment. This collaborative effort is expected to unite financial institutions, equipment manufacturers, leasing firms, development partners, and state governments in advancing agricultural mechanization initiatives nationwide. The partnership is projected to bolster sustainable mechanization systems, enhance agricultural productivity, and ultimately improve food security outcomes across Nigeria. The MoU is set for an initial four-year term, with provisions for renewal.

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NADF will provide advisory support and facilitate capacity-building programmes related to agricultural equipment operations.