Bank of Namibia introduces relief for agricultural sector

The Bank of Namibia has issued a new directive, Determination BID-42, to provide financial relief to the agricultural sector. This measure aims to support farmers and businesses struggling due to Foot-and-Mouth Disease (FMD) outbreaks and drought conditions caused by El Niño.

Under the new policy, commercial banks are directed to grant loan repayment moratoriums ranging from one to 24 months for qualifying clients. The duration of these moratoriums will be determined by an assessment of each borrower’s financial position and repayment capacity. The relief extends to the broader agricultural value chain, including businesses whose cash flows are materially dependent on agricultural activity.

In addition to moratoriums, banking institutions may restructure existing loans to make installments more manageable. While restructuring is permitted to improve a borrower's ability to meet obligations, the central bank clarified that restructured loans will continue to accrue interest at the original contract rates.