Standard Chartered Bank (Kenya) #ticker:SCBK has signed a Sh3.5 billion financing deal with Kenya Tea Development Agency (KTDA) for purchase of 95,000 tonnes of fertiliser to be distributed to tea farmers.
The loan attracts a floating rate, which currently stands at 3.6 percent per annum.
The deal, which is part of KTDA’s fertiliser supply programme for farmers, will see over 650,000 growers affiliated to the 69 factories managed by the agency benefit from supply of the commodity through the arrangement.
Speaking during the signing ceremony Tuesday, KTDA chief executive Lerionka Tiampati said the move will help farmers’ access affordable fertiliser that will go towards improving the quality and yield of their produce.
“We are pleased to be signing this partnership with Standard Chartered Bank as it will enable us acquire fertiliser which will be distributed to our farmers at the most competitive price,” said Mr Tiampati.
“This fits well with our long-term strategic objective to continuously work towards providing smallholder tea farmers with a wide-range of cost-effective solutions for their everyday farming requirements.”
StanChart chief executive Kariuki Ngari said the bank is proud to support the KTDA in this programme, pointing out that the strategic partnership is in line with the bank’s objective of offering tailor-made solutions to its clients.
“We are delighted to be announcing this partnership with the KTDA as it seeks to provide affordable fertiliser to its members,” he said.
Mr Ngari said tea is a key export sector that earns the country much-needed foreign exchange and that StanChart is at the forefront of driving agriculture through corporates like agency to bring prosperity to farmers.
“This financing is in line with our brand promise "Here for good", while at the same time supporting sustainability in the tea sector as well as providing bespoke solutions to all our clients,” he said.
In entering into the arrangement, the KTDA is leveraging on economies of scale afforded to it by its size to obtain the most competitively priced fertiliser in an international open tender.
The fertiliser is set to arrive in July and August for subsequent distribution to farmers for the onset of the short rains.