ECX Launches Financing Scheme for Maize Farmers

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ENA, December 26/2019 Ethiopia Commodity Exchange (ECX), in collaboration with Commercial Bank of Ethiopia and International Finance Cooperation, launched warehouse receipt financing (WRF) for maize today.

During the launching ceremony, ECX Chief Executive Officer Wondimagegnehu Negera said  WRF will allow farmers, cooperatives, traders and processors to store maize and use it as collateral to access credit from the Commercial Bank of Ethiopia.

He added that they can access credit after handing over goods receiving note and without any additional collateral.

The CEO said warehouse receipt finance is an inclusive form of lending that “allows large and small-scale players in the agriculture value chain to access loans from bank.”

Loans worth up to 70 percent of the value of the stored commodity will be issued at a competitive interest and repaid within three months, it was learned.

“This in particular is important for farmers who often lack bankable collateral and are therefore forced to sell their crops immediately after harvest when prices tend to be at their lowest,” Wondimagegnehu elaborated.

The launched instrument will be functional at Bure and Nekemte maize warehouses of the exchange in Amhara and Oromia regional states respectively.