The fund is to be managed by the Bank of Industry (BOI).
The Minister of Agriculture, Akinwumi Adesina and the Managing Director of the BOI, Evelyn Oputu, signed the Cassava Bread Fund agreement.
It is also aimed at providing ready market for Cassava farmers.
“As we speak today, six industrial corporate bakers and 20 master bakers produce Cassava bread regularly with at least 20 per cent high quality Cassava flour.
“Nigerians like this bread. It is healthier, tastier and cheaper and the demand for it is rising by the day.
“A total of 1.05 billion Naira will be used to upgrade the capacity of 35 existing small scale flourmills. It will be provided as 50 per cent loan and as 50 per cent grant,” the Minister, who is Forbes Africa Person of the Year, said.
The funds will be made available at a single digit rate.
Oputu urged stakeholders to demonstrate resilience commitment and the persistence that the minister had demonstrated, as he initiates necessary reforms in the Agriculture sector.
“We have been involved in cassava processing but there were, strangely, difficulties because the end user that was anticipated was not there at the end of the period, Oputu.
The Cassava Bread Fund is expected to produce 5,000 bakers and many more SMEs producing Cassava flour.
The provision of the fund is part of the Nigerian government’s plan to diversify the economy which is hugely dependent on Crude oil revenue.
With over 81 million hectares of land available for farming, the government is looking to make agriculture the mainstay of the Nigerian economy while ensuring food security in Nigeria and other parts of Africa.
Nigeria is currently the highest producer of the crop which has over 40 verities that can be produced in 34 out of the 36 states.