Tea farmers affiliated to Kenya Tea Development Agency (KTDA) will from December access credit at a lower interest rate of eight percent from the Greenland Fedha, a fully owned subsidiary of the firm.
Currently, farmers have been getting different types of loans from the subsidiary at an interest rate of 14 percent, which is higher than the 12.09 percent that commercial banks charge.
Tea farmers affiliated to Kenya Tea Development Agency (KTDA) will from December access credit at a lower interest rate of eight percent from the Greenland Fedha, a fully owned subsidiary of the firm.
Currently, farmers have been getting different types of loans from the subsidiary at an interest rate of 14 percent, which is higher than the 12.09 percent that commercial banks charge.
The high interests have seen farmers and the government raise concern, questioning how growers can be charged exorbitant rates when borrowing money from their entity. Greenland Fedha is a non-deposit taking microfinance institution managed by KTDA Limited.
“KTDA is putting in place mechanisms to ensure small scale tea growers will have access to credit facilities from Greenland Fedha Limited at an affordable rate of eight percent per annum with effect from December 2021,” said Agriculture Cabinet secretary Peter Munya.
KTDA chairman David Ichoho said their interest is to support farmers and not to profit from the loans.
“The economy is now tough, especially for farmers who rely on tea for their daily needs, we want to issue loans at affordable rates,” he said.
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