New KPCU may revise rules on Sh3 billion cherry fund

Kenya Planters Cooperative Union

Kenya Planters Cooperative Union headquarters in Nairobi. The agency will adopt technology to simplify loan applications.

Photo credit: File | Nation Media Group

New Kenya Planters Cooperative Union (New KPCU) could review guidelines that regulate disbursement of the Sh3 billion Cherry Advance Fund after realising a slow uptake a year since inception.

The fund affords loans to farmers at a three per cent interest. The loans, meant to cushion farmers against post-harvest losses, has been met with resistance.

Through the Ministry of Agriculture, New KPCU is pushing for a review that will introduce avenues that will see the fund used comprehensively.

Of the Sh3 billion available, only Sh300 million has been disbursed in coffee-growing areas.

New KPCU chairman Henry Kinyua said the review will address gaps identified to ensure the money is easily available to farmers.

He added that the time given to educate farmers on the importance of the fund and its disbursement was insufficient.

Farmers belonging to co-ops or estates can access credit of up to 40 per cent of the prevailing average sale price at the coffee exchange or Sh20 per kilo of the cherry delivered at the factories.

“We may include Sh2 to Sh3 or any other amount per kilo of coffee delivered to cover factory operations,” Mr Kinyua said.

The reviews would target key issues in the value chain, from production, processing to marketing.

Mr Kinyua added that slow funds uptake has been due to the long period taken to formalise the regulations as some farmers went to court to challenge the formation of New KPCU.

Farmers have criticised the decision to channel the money through New KPCU, saying, it should have been given to coffee-growing counties as conditional grants.

Others say the loan application is cumbersome.

Mr Kinyua said New KPCU would soon use technology to ensure simple and less time-consuming application for funds.

Many growers have not applied for the loan as they have huge debts with their co-ops. With many delivering about 500 kilos of cherry a season, the most they can access is Sh10,000.

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