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Land Bank could benefit from risk-shy commercial banks

According to Willie du Plessis, Standard Bank's director of agricultural banking, the risks and transaction costs in development farming are much too high for the comfort of commercial banks' shareholders and stakeholders. This situation presents enormous opportunities for the Land Bank, Business Day reports.
However, while the Land Bank provided wholesale finance to co-operative agribusinesses which then offered loans to finance the development of farming, commercial banks should get involved in financing development projects that were presently the focus of agribusinesses and could create jobs and support small-scale farmers, Du Plessis said, reports Business Day. His comments come a week after the Competition Tribunal approved, without conditions, a deal in which Afgri's GroCapital unit sold its debtors' book, valued at about R2,4 billion, to the Land Bank.

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