Nigeria’s National Agricultural Development Fund (NADF) has validated its proposed Non-Interest Finance Framework and Operational Guidelines, in a move aimed at expanding access to ethical, asset-backed agricultural finance for smallholder farmers and agribusinesses.

The framework was presented during a stakeholder session on September 22, where participants reviewed proposals designed to complement conventional financing models and bring more underserved farmers and agricultural businesses into the formal financial system.

NADF Executive Secretary and Chief Executive Officer Mohammed Ibrahim said the framework would establish standards covering governance, risk management and Shari’ah compliance for agricultural interventions delivered through licensed Non-Interest Financial Institutions.

NADF Head of Investment Olalekan Alabi said the proposed guidelines provide an operational structure for the design, assessment, approval and monitoring of non-interest agricultural financing. He noted that the documents remain technical drafts and will undergo further stakeholder review before final publication.

The initiative has received support from the Central Bank of Nigeria (CBN) and development partners. CBN Director of Development Finance Advisory, Dr Paul Oluikpe, said the framework could help address Nigeria’s agricultural financing gap as the central bank reduces its role in direct intervention lending.

Professor Bashir Aliyu Umar, Deputy Chairman of the CBN Financial Regulation Advisory Council of Experts (FRACE), said non-interest financing could also strengthen financial inclusion by providing additional formal financing channels for farming communities and commercial agricultural operators.

For Nigeria’s agriculture sector, the proposed framework could create another financing pathway for businesses that face challenges accessing conventional credit. Its implementation, however, will depend on the completion of technical consultations, finalisation of the guidelines and establishment of appropriate financing and risk-management mechanisms.

The initiative forms part of broader efforts to strengthen agricultural finance and improve access to capital across Nigeria’s farming and agribusiness value chains.