Prime linked and risk based.
The purpose of the animal fattening loan is to provide finance to farmers who purchase and rear animals with the aim of increasing the live weight of the animals and the market price and sell it. Later in addition to purchasing animals, the loan may be used for buying animal feeds and treatment of diseases and pests.
Financing for start ups allowed but subject to experience and eligibility. More focus should be those already in business of purchasing and selling and should own at least 3 animals.
Based on certainty of repayment source. Positive free cash flow and DSCR.
Agricultural loan officer's farm visit report. Minimum of 1 year experience in animal fattening activities or qualification of the clients in relation to the loan requested. Collateral required. Account with LPB . 3 months bank statement. Proof of ID/passport. Map to the client's residential place: owned and rented.
The maturity of an animal fattening loan shall partly depend on the applicant's request but in any case it shall not exceed 12 months. Client's are to be encouraged to repay their loans within 6-8 months since one-year old animals will normally assume the desired weight and be ready for sale within that period. Minimum loan amount M2k and max M200k. Payment mode dependent on cash flow. As a general rule, animal fattening loan instalment must be repaid on monthly basis, although bi-monthly and quarterly payments may be accepted in some situation.