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The Agriculture Window funds are intended for financing agricultural and livestock production, processing and marketing.
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A borrower must be legally in existence in Tanzania and registered with the appropriate recognized authority (i.e. as a limited liability company or SACCOS or community bank, etc.)
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A borrower must have a good business track record and must have been in the agriculture industry for at least one year.
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The entity has to exhibit good corporate governance and demonstrated management competence.
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The minimum total equity contribution is 30% of the total project cost, of which 10% must be in cash to be deposited with TIB. In the absence of cash, the minimum equity required is 40% of the project cost.
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For any landed property to be taken as part of promoter’s equity contribution, it must be
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For a single borrower (including group of related entities) the maximum exposure is TZS 1,000 million while minimum exposure is TZS 50 million.
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Corporate and other direct (from TIB to project) loans will be charged interest at 5%p.a. and upfront facility fee at 1%. No other fees will apply.
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Wholesale loans will be charged interest at 4%p.a. and upfront facility fee at 1%. Such wholesale borrowers shall on-lend at maximum of 8%p.a. (interest) and 2% facility fee.
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Loan tenures shall be between 6 months and 15 years.
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The Agriculture Window funds shall be for lending to
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small scale farmer groups, associations and cooperatives (30%);
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on-lenders to small and medium scale farmers and agri-businesses, such as community banks and micro-finance institutions (30%); and
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medium and large scale corporate farms and agri-businesses (35%). The remaining 5% shall be for technical assistance.
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There must be detailed information on the availability of markets for the products to be produced by the project.
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The project must have ability to generate revenue for interest payment during the specified grace period.
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There has to be adequate suitable storage facilities, and in the case of farming, adequate water and infrastructure for irrigation.
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The promoters and borrowing entity must be having good borrowing records and demonstrated sound financial management.
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The farm land where agricultural activities to be financed will take place must be in the ownership of the borrowing entity.
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Funds from the Agriculture Window will not be used to refinance existing commercial loans.
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Borrowers who have accessed other government subsidized funds or guarantees and have not been or are not performing in accordance with agreed terms will not be considered for loans under this Agriculture Window.
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In the rare cases of start up businesses/projects to be considered, promoters must be possessing extensive skills and knowledge in the envisaged lines of business.
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Primary collaterals to be pledged to the bank must rank first in priority.
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The primary security must be owned by the project or its promoters. Third party property can only be accepted as supplemental security.
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Any disbursement shall be subject to a satisfactory outcome of credit appraisal, obtaining necessary approvals, and fulfillment of conditions precedent.
