The Bank of Ghana (BoG)'s plan to establish a fund dedicated to financing the agriculture sector appears to the taking shape as it starts inviting bids from consultants to help with setting up of the Fund.

BoG in a public notice is asking for applications from firms that have the capacity to manage the Funds to apply.

The Fund would be known as the Ghana Incentive-based Risk Sharing System for Agricultural Lending.

The Central Bank said it is doing this in partnership with the Ministry of Agriculture with support from Alliance for Green Revolution in Africa.

According to BoG, the Fund is to provide technical support for institutions that provide funding to farmers especially those in the rural areas.

It would also come up with some innovative insurance products for farmers to help reduce the risk in the sector.

Also, there would be a mechanism that would incentivise commercial banks to increase lending to the sector.

Furthermore, BoG would be coming out with a new mechanism that would rate banks based on their lending to the agriculture sector.

Farmers would also get support from the Fund to go digital with the use of mobile phones.

In a related development, Second Deputy Governor, Johnson Asiama, tells JOYBUSINESS they are hoping to use the Fund to address some of the numerous challenges facing the sector. 

"For us, that is one small way of contributing. At the end of the day, financing to Agric has to come from various sources...what we want to do is the small and smart interventions that will facilitate to make flows go to that sector," he said.

He added that the intervention will facilitate funding for the Agric sector, BoG is looking at supporting the production of a number of cereals and some vegetables like tomatoes.