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Are cereal banks best option to fight hunger?

Nigerien cereal bank stock, outside of Zinder, August 2008. Phuong Tran/IRIN

Cereal banks – small warehouses used to buy, store and sell grains – have long helped Sahelian communities access affordable food year-round. But these community-run banks often run out of money. Borrowers default; bank managers price-gouge or simply steal money, leaving villages as hungry as before. But supporters say even a flawed solution to fight hunger is better than no solution, and founders of a new community cereal bank in Niger said they have a better model.

“For 30 years, I have watched cereal banks fail around me,” said founder Ibrahim Tanko. “It was always the donor who came in and imposed [its] vision of what the community needed.” The village bank, founded in November 2007, is in Gobro, 20km outside of Zinder in Niger’s driest agricultural zone.

Tanko said he had worked as a community liaison for 20 years with international non-profit organisations that helped subsidise cereal banks in Niger, including France’s Afrique Verte. “There needs be a new model of NGO assistance. It is not working. Communities do not take ownership of what they do not set up themselves. People stole, managers disappeared, or the bank was located too far for some villagers to get their food.”

The UN World Food Programme (WFP) supports half of Niger’s 4,000 cereal banks with cereal contributions during the banks’ first year of operation.

Tanko said for his bank start-up, led by a group of women, founders did not want any outside support to build or stock its warehouse, “We do not want any interference. If a community is given the option between taking free grains or not, of course it will come to think it cannot start a bank on its own.”

Most banks have a sponsoring agency that gives money for construction and a loan to buy the first grain “deposit” right after harvest time when prices are lowest. Villagers store either locally-grown or imported cereal in the warehouse until June, when prices shoot up because of scarcity, then sell the grains at prices lower than market but sufficient to make a small profit.


Laouali Sama, the director of an anti-poverty UN Development Programme in Zinder that launched 220 community cereal banks between 2004 and 2007, said the banks’ problems are not due to donors’ role: “Banks are a microcosm of Africa. [Banks’] problems are Africa’s problems. There are management problems, transparency and corruption issues no matter who funds the start-up.”

Cereal banks have had mixed performance reviews. As of August 2008, WFP in Niger found 87 percent of the banks it had supported since 2004 still operational.

Nevertheless, Niger’s WFP deputy director Gianluca Ferrera told IRIN management challenges remain, especially in rural areas with high illiteracy levels.

Bank founder Tanko said his Gobro bank’s all-female management committee was searching for a treasurer who can read.

Photo: Phuong Tran/ IRIN
An evening meeting of members of the recently-created cereal bank in Gobro

UN’s Sama said cereal banks are unique and should not be compared with traditional businesses. “We are not trying to necessarily generate wealth. The banks are for survival. Maybe banks in agriculturally-rich zones can be self-sufficient, but here in the driest parts of the Sahel? We are not working with normal businesses.”

He added that businesses around the world fail, and more patience and nurturing are needed with village cereal banks. “These are peasants who have a right to make errors.”

Sama said most bank managers are volunteers, which can explain some of the lax oversight, corruption and poor management that often derail operations.

But he told IRIN even if a bank is not buying, storing and selling grains, this does not mean it has died. “They may have periods of inactivity, but banks come back to life because communities need them. Even if a bank is not perfect, it helps stabilise a community. Besides, what is our option? Not do anything to fight hunger?”


This article was produced by IRIN News while it was part of the United Nations Office for the Coordination of Humanitarian Affairs. Please send queries on copyright or liability to the UN. For more information: https://shop.un.org/rights-permissions

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