banksss.jpgFailure by farmers to repay loans received in the 2010/11 farming season has emerged as a stumbling block for farmers who intended to access finance from the banking sector.

With the 2011/12 summer cropping season well under way, several farmers are still facing difficulties in accessing long term financing from banks.

Banks are offering short term loans ranging from 3 to 6 months, which are too short for the tenure of agricultural projects.

Zimbabwe Commercial Farmers Union (ZCFU) Chief Economist, Mr Peter Gambara said an estimated 80% to 90% of large scale farmers require loan financing each year but the reputation of farmers is being destroyed by a few who fail to repay.

A meeting held by farmers and bankers before the current summer cropping season revealed that it would take time for the agricultural sector to regain bankers’ confidence.

Zimbabwe Farmers Union Executive Director, Mr Paul Zakariya said there has been a marked decline in the number of farmers benefiting from banking institutions in the past two year, urging farmers to be honest.

While the latest figures on loan distribution from the Bankers Association of Zimbabwe (BAZ) were not readily available by the end of day, data revealed by the central bank in August last year shows that the agricultural sector was the largest recipient of bank loans accounting for 21,2% while the manufacturing sector received 19, 8%.