With the Land Bank starting to improve its management, it is looking to role out a new finance model, which will see the government guaranteeing loans to aspiring commercial and cash-strapped farmers.

The current trend has been to lend to farmers at prime plus 2% but this trend is no longer a necessity, according to Land Bank CEO, Phakamani Hadebe, who has led the Land Bank’s turn around in 2009.

The Land Bank will continue to lend to both the commercial and emerging farmers sectors, in terms of the restructuring and revised mandate. The new model will see the Department of Agriculture, Forestry and Fisheries provide collateral for those cash-strapped farmers who need assistance with loan repayments.

Reported by Fin24