NADF, firm move to cut agribusiness loan costs

By Yunusa Abubakar

The National Agricultural Development Fund has partnered with Sahel Capital Fund Manager Limited to reduce financing costs for agribusinesses and attract more private investment into Nigeria’s agricultural sector.

The partnership, sealed through a Memorandum of Understanding on Thursday, November 5, 2026, is also aimed at addressing challenges affecting agricultural productivity and strengthening agricultural value chains.

Speaking at the signing ceremony, Managing Partner of Sahel Capital, Mezuo Nwuneli, said the firm was attracted to the partnership by NADF’s commitment to addressing critical challenges in the agricultural sector.

He cited the fund’s interventions in ginger production, including the provision of farm inputs to farmers and the promotion of irrigation, as evidence of its efforts to improve agricultural productivity.

“What we saw with NADF is that it has been very focused on figuring out how to solve critical problems in the ecosystem,” Nwuneli said in a statement on Friday.

He explained that the partnership would concentrate on two major areas: reducing the cost of financing for agribusinesses and identifying challenges affecting agricultural productivity for joint intervention.

Nwuneli lamented that many small and medium-sized agribusinesses currently access loans at interest rates ranging between 24 and 27 per cent, making it difficult for them to expand their operations.

He said the proposed arrangement would enable NADF to provide capital alongside Sahel Capital, thereby lowering the blended cost of financing available to eligible businesses.

“Lower cost of financing means you can do more, you’re more economically viable, and there’s more of your cash flow going to growth versus financing,” he said.

The Sahel Capital managing partner added that the firm had made 45 investments across eight African countries in the last 15 years.

He said the investments involved providing growth equity and private credit to businesses with annual revenues ranging from N500m to N20bn.

According to him, the firm would bring its investment experience and knowledge of different agricultural value chains to strengthen Nigeria’s agribusiness sector.

Speaking on the partnership, the Executive Secretary of NADF, Muhammed Ibrahim, said the agreement was designed to move agricultural financing beyond conventional lending towards building a sustainable investment ecosystem.

Ibrahim argued that although agriculture was often considered a high-risk sector, it offered significant investment opportunities that could be unlocked through appropriate financing structures.

“The agricultural sector is often viewed through the lens of risk, but beyond those risks lie enormous opportunities,” he said.

He said the partnership would combine NADF’s development mandate and understanding of national agricultural priorities with Sahel Capital’s market knowledge and investment expertise.

“What we are doing with Sahel Capital is a deliberate shift from simply financing agriculture to building an investment ecosystem where capital can flow sustainably into the sector, attract more investors and support the growth of agribusinesses,” Ibrahim said.

He added that the arrangement would bring together public-sector and concessionary capital with private investment expertise to create a financing structure capable of attracting institutional investors.

Ibrahim said the initiative would also allow more investors to participate in financing viable agribusinesses and benefit from opportunities across the agricultural value chain.