Farmers received Sh400 million from the Coffee Cherry Advance Revolving Fund six months to December 2022, even as stakeholders called for changes to enable higher uptake of the Sh3 billion kitty.
This is nearly double what had been dished out in the 12 months to June 2022, pointing to continued awareness of the credit by coffee producers.
In the Financial Year 2021/22, only Sh200 million had been distributed to coffee farmers out of the total amount.
“We still have Sh2 billion that is yet to be disbursed. I feel very bad when I see money just lying there in banks,” said Timothy Mirugi, acting manager for the New Kenya Planters Cooperative Union (KPCU).
Mr Murigu spoke on Tuesday in Nairobi following a meeting between the leaders of the co-operative movement and the Cabinet Secretary for Cooperatives and Micro and Small Enterprise Simon Chelegui where they conveyed their support to the State-driven coffee sector reforms including the appointment of Deputy President Rigathi Gachagua to champion them.
The Coffee Cherry Advance Revolving Fund was rolled out in 2019 by the government of former President Uhuru Kenyatta with the objective of advancing cheap credit to small-scale growers to boost output and quality of the crop, by tackling delays in payment.
Farmers affiliated with different cooperatives including Kenya Planters Cooperative Union would receive the loans at the rate of three percent.
The amount that each grower receives depends on the coffee that they can produce.
However, uptake of the fund has been low, with the National Coffee Co-operative Union (NACCU) attributing it to structural and regulatory hitches.
“People are wondering why these farmers have a lot of problems. Why have they not come forward? It is because of the management…the regulations that were put in place,” said chairman of NACCU Francis Ngone.
He added: “The regulator of that coffee cherry advance, brought in attachments that are not favourable. We have agreed with the minister (Simon Chelugui) that the new KPCU will start working with the unions for easier collaboration with the farmers.”
The Ministry of Agriculture had previously said that it was considering expanding the State-backed fund to offer additional services in the sector following slow uptake.
