Commercial Farmers Union of Zimbabwe

Newly-resettled farmers reel from AgriBank loans

Newly-resettled farmers reel from AgriBank loans

http://www.theindependent.co.zw

February 25, 2013 in News

NEWLY-resettled A2 farmers in Mvurwi, Mashonaland Central province are 
living on the edge after AgriBank issued final letters of demand urging them 
to settle outstanding debts or their properties lodged as collateral would 
be auctioned, the Zimbabwe Independent has established.

Many A2 farmers have been struggling to access new loans to finance their 
production after failing to settle previous debts. The farmers failed to 
settle the debts for a variety of reasons, among them failure to receive 
payment from the Grain Marketing Board on time or poor harvests.

Two weeks ago, Phillip Kunaka, a resettled farmer, committed suicide at his 
Pembi Chase farm over a US$130 000 debt to Agribank.

Sources close to him said Kunaka left a suicide note in which he claimed 
Agribank was threatening to auction the house he had lodged as collateral 
for failure to settle the debt.

Kunaka had lodged his brother-in-law’s house as collateral and had failed to 
settle the debt for the past two seasons leading to the final letter of 
demand.

Mazowe North MP Cairo Mhandu confirmed the development.

“Kunaka committed suicide over some debt with Agribank,” Mhandu said. “He 
left a note that said Agribank was about to auction a house he had lodged as 
collateral but unfortunately it belonged to his brother in law.”

Agribank is reeling under bad debts as farmers fail to repay their loans. An 
Agribank Mvurwi branch official acknowledged that some farmers were finding 
it difficult to repay loans but refused to give further details.

“I am not at liberty to discuss the bank’s loan book. For that information 
you can check with our head office,” said the official.

Finance minister Tendai Biti is on record telling parliament that government 
is trying to restore land value by giving tradable 99-year leases to new 
farmers that can be used as collateral at banks.

However, government is still to complete a comprehensive land audit and 
survey of the new farms before it can offer the new 99 year leases.

Lands and Resettlement minister Herbert Murerwa says the survey has been 
delayed by a shortage of surveyors in the country.

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