Cassava farmers who received loans from the Development Bank of Rwanda (BRD) are appealing for the relief of Rwf953 million debt after their crops were ravaged by a viral disease.
The loan was given to 29 farmers, 24 of them from Ruhango and the rest from Kamonyi, Nyanza and Gisagara districts.
They got the loans in the 2012/13 season, at 15 per cent interest rate. They had to pay it after one year when they had harvested their crop, but until now, only one farmer has managed to settle the debt.
BRD CEO Eric Rutabana told The New Times that only two farmers signed a revised loan consisting of waiving overdue loan repayment interest, and paying off over a five-year period from the time of signing the contract. The bank restructured the deal in August 2015.
But the remaining 26 farmers did not sign the amended agreement, nor do they service the loan.
Farmers concurred with Rutabana giving reasons for not signing the deal. Some said they did not have the means, others needed support to get seeds and fertilisers so as to carry on with farming practices and settle the loan gradually.
On February 16, 2015, the farmers wrote to the Prime Minister’s office followed by a petition to Parliament on December 20, 2015, seeking intervention on the matter.
In January 2017, the farmers said they wrote to the President requesting for support to repay the loan, according to François Hitimana, the secretary of KOAIMA – a cassava farmers’ cooperative in Ruhango District’s Kinazi Sector.
He said that they requested the government to waive the loan, or look for funds either from sponsors, or from its own coffers to help them service the loan.
They grew cassava intensively and applied fertilisers so that they get high yields and supply it to the $10 billion Kinazi Cassava Plant – a Ruhango District-based flour mill with capacity to process 120 tonnes of cassava per day.
Hitimana, 62, secured a Rwf17 million loan from BRD to grow cassava on 13.5 hectares. But, he said, he also used his own money to grow the crop on a total 19 hectares after selling his 15 cows.
Hitimana said they would produce 30 tonnes of cassava per hectare.
But, talking to The New Times, he said almost all his investments were lost when the Cassava Brown Streak Disease (CBSD), locally called ‘Kabore’, ravaged his crops.
“The cassava business had a lot of potential to generate wealth as agronomists had studied it but Kabore spoilt our plan as it destroyed plantations,” said the farther of six.
Leonard Ndagijimana, 57, a farmer and president of the KOAIMA, told The New Times that he received Rwf19 million that he used to grow cassava on 14 hectares. But his cassava was rejected on the market as it was affected by Kabore.
The farmer said that he managed to pay off Rwf14 million thanks to the money he got from the supply of bricks to Ruhango District for school construction.
But, he said that he has no other means to repay the remaining part of the loan which accumulated to Rwf22 million.
He said that one farmer who managed to repay the loan had used money to buy cassava produce from other farmers before the crop was attacked by Kabore, and supply it to Kinazi Cassava Plant.
“We really do not have means to repay the loan. We do not have investments to carry on farming,” said Ndagijimana.
Asked about signing the revisited agreement, Hitimana said: “We cannot sign an agreement to repay the loan without other investments.”
Flexibility on the debt issue
BRD’s Rutabana said that in order to facilitate farmers, the bank waived late loan payment penalties and extended the farmers’ loan repayment period under the revised agreement.
“As we had agreed that we would waive the overdue loan payment interest, we would request them to pay back over Rwf700 million that we agreed upon together by the time we made the new arrangement. But, because nothing was done, the loan had accumulated to Rwf953 million. We continued to count interest because they did not sign the agreement,” he said.
“But, if there is an understanding, we can, together, revisit the figures and consider what we can count in or out,” Rutabana said. However, he expressed concern that some farmers seem not to be bothered by their credit issue.
“We should continue to partner with other concerned institutions, including the districts where the farmers hail from, and the Ministry of Agriculture and Animal Resources so that we can reach some agreement which can help address the problem,” he said.