Social Issue

The Nigerian Agricultural sector accounts for 22% of Nigeria’s GDP and employs an estimated 58% of the country’s active workforce. The sector is predominately made up of smallholder farmers who produce over 70% of the nation’s food and own over 80% of all agricultural land.  However, yields are very low and it is estimated that Nigerian crop yields are 20% to 50% of that obtained in other developed countries. As a result, millions in the sector remain impoverished, earning less than 2 USD/day. Northern Nigeria, where agriculture dominates the economy, produces a majority of the nation’s staple food crops (such as maize, soybeans, rice) yet faces extreme poverty with the region registering as one of the poorest in the nation.

The low profitability of small farmers is due to the lack of access to credit to obtain resources, the lack of knowledge of how to manage them, and the inability to sell their products at a fair price.

Our Response

Babban Gona is a for-profit company in Nigeria whose mission is to improve the incomes and livelihoods of small farmers by transitioning to more profitable commercial farming practices, and by providing a comprehensive set of services that include training, financial services, agricultural investments, and marketing services. The company faces these challenges with a business model in which farmers organise into “trust groups” whose members receive quality funding and training. Thanks to this, they have been able to more than double the yield of their crops. Furthermore, improved market access has allowed these small farmers to benefit from a price increase of between 20% and 30% compared to those who work alone.

Expected Social Impact

Babban Gona had 3,000 farmers enrolled for the 2015 season. The company plans to grow rapidly in the coming years so that the impact directly attributable to this loan will enable more than 200 farmers to increase their productivity and earn more income by about $180 a year from the sale of surplus corn.