By JAYNE SAFIHAO
MADANG Governor Sir Arnold Amet has urged commercial banks and lending institutions to relax their lending policies towards rural farmers and villagers.
Sir Arnold said commercial banks were too stringent with their credit facilities.
The governor was speaking at the opening of a new cocoa shed in Aronis village, Sumkar district, Madang, last week.
The Bargam Cocoa Cooperative Society Ltd sought a K22,000 funding from the National Development Bank (NDB) to build the cocoa shed.
Sir Arnold was among a number of guests invited to celebrate with cocoa farmers and their families in the village.
The villagers had difficulties getting help from anyone, including the banks, until they approached NDB.
“Commercial banks should relax their policies on equity and interest rates, security, turn around time and give an ample grace period on loan repayment terms for villagers who wait for their cocoa or coconut trees to mature after so many years,”he said. “You cannot expect people to pay up in the next year or so in such a situation and I praise the NDB for getting back on their feet to finally operate, giving such small business entities a chance.”
Under NDB’s Corporate Societies Units department, smalltime farmers and business groups have been accessing loans.
NDB Madang representative Morris Unido said he was proud to see corporate societies like Bargam make use of the bank’s loan facilities.
He said loan payment times would have to be flexible for cash crops as they took time to grow and that posed cash flow problems for lending institutions such as NDB.
Gabriel Kasup, Sumkar district spokesman, who stood in for local MP Ken Fairweather, said the occasion was a milestone.
“This proves that the K22,000 from the joint district budget planning committee was put to good use after paying for 300,000 cocoa seedlings and poly bags for farmers in Sumkar,” Mr Kasup said.