World Environment Day: Ringim Urges Banks to Treat Agricultural Financing as Climate Action

 

  As the world commemorates World Environment Day, Executive Director of Business Banking at Union Bank of Nigeria, Dr. Mannir U. Ringim, has called on financial institutions across Nigeria and West Africa to recognize agricultural financing as one of the most effective forms of climate action available to the region.

In an article marking the global environmental observance, Ringim argued that climate change is already reshaping the livelihoods of millions of farmers, making access to finance critical for food security, economic stability, and climate resilience.

According to him, African farmers have traditionally relied on environmental signals such as rainfall patterns, cloud formations, and seasonal changes to guide agricultural activities. However, changing weather conditions, prolonged droughts, erratic rainfall, flooding, and desertification have made those signals increasingly unreliable.

“Nature is still sending its signals; they have become harder and crueller to read,” Ringim noted, highlighting the growing vulnerability of smallholder farmers across Nigeria and the wider West African region.

He pointed to the shrinking of Lake Chad, advancing desertification in the Sahel, severe flooding in Nigeria’s Middle Belt, and coastal erosion as visible examples of climate-related challenges affecting agricultural productivity and rural livelihoods.

Ringim stressed that climate change in the region often manifests first as an agricultural crisis, with consequences extending to food prices, migration, employment, and economic growth.

“Agricultural finance is climate finance,” he stated, arguing that investments in farming communities offer a direct pathway to addressing food insecurity, rural poverty, and climate adaptation simultaneously.

Despite agriculture employing the largest share of Nigeria’s workforce and contributing significantly to economic output, Ringim observed that the sector continues to receive only a small proportion of total bank lending. He attributed this to longstanding concerns over risk, seasonality, informality, and limited collateral among smallholder farmers.

However, he maintained that many of these risks can be mitigated through innovative financial solutions, including crop-cycle lending, value-chain financing, warehouse receipt systems, weather-index insurance, irrigation financing, mechanisation support, and digital technologies that improve credit assessment.

According to him, investments in drought-resistant seeds, irrigation systems, storage facilities, and sustainable farming practices not only improve productivity but also strengthen resilience against climate shocks.

Ringim further emphasized the need for collaboration among governments, development finance institutions, insurers, agritech firms, and commercial banks to scale agricultural financing across the region.

He cited initiatives such as Nigeria’s Agricultural Credit Guarantee Scheme and the Anchor Borrowers’ Programme as examples of efforts that have demonstrated both the opportunities and challenges associated with public-private agricultural finance partnerships.

The Union Bank executive also highlighted the economic potential of Northern Nigeria and other climate-vulnerable regions, describing them as areas with vast agricultural resources, established value chains, and a youthful workforce capable of driving future growth.

He noted that financial institutions have a crucial role to play in transforming agriculture from a sector often associated with poverty and subsistence into a viable engine of economic development and climate resilience.

“At Union Bank, we regard agricultural finance not as a niche or an act of charity, but as national infrastructure and, increasingly, as climate infrastructure,” Ringim said.

He concluded by urging financial institutions to rethink how they assess and price agricultural risk, calling for greater investment in farmers and rural communities.

“The most meaningful climate commitment our financial sector can make this World Environment Day is not a statement; it is a willingness to finance the land that feeds us, intelligently and at scale,” he said.