Co-operative Bank and CFAO Kenya Ltd (Toyota Tsusho East Africa Ltd) have launched a new Financing Scheme that will enable farmers and co-operative societies to finance the purchase of tractors, combined harvesters and other farm equipment through loans.
The scheme will offer farmers and co-operative societies up to 80 percent financing in purchase of agricultural machinery and equipment. The scheme will also give farmers the option of seasonal loan payments, to match with the seasonal nature of some agricultural crop cycles.
In a statement, the two firms said that farmers will enjoy an extended loan repayment period of up to 60 months, perhaps the longest available in the market today.
For customers who pay 50 percent deposit and repay the loan in 12 months, the loan will not attract any interest charges.
As an added benefit, customers will receive 250 kilogrammes of Baraka Fertilizer with the purchase of every tractor under this scheme.
“With this partnership, we will enable farmers and co-operative societies to more easily acquire brand new Agri-machinery and equipment from a trusted and leading brand,” said Co-op Bank Director of Co-operatives Banking, Mr Vincent Marangu.
“We will provide continuous operator training and excellent aftersales support. We feel honoured to partner with a bank like the Co-operative Bank that will give access to societies and farmers looking to re-tool, mechanize and upgrade farms through this partnership,” said CFAO Kenya Managing Director Mr. Toyoki Kuno.
CFAO Kenya Ltd is an integrated business group that started in the automotive value chain sector but has expanded to other sectors including renewable energy, infrastructure development and Agri-mechanization.
CFAO Kenya are the authorized distributors of CASE IH Tractors in Kenya through their Agri Mechanization division headquartered in Nakuru. The tractors’ capacity range from 30 horsepower to 620 horsepower. CFAO range of products and services also include Baraka fertilizer.
Agriculture is key to Kenya’s economy, contributing 26 per cent of the Gross Domestic Product (GDP) and another 27 per cent of GDP indirectly through linkages with other sectors.
According to the Food and Agriculture Organization (FAO) the sector employs more than 40 per cent of the total population and more than 70 per cent of Kenya’s rural people.