• Saturday, Sep 22, 2018
  • Last Update : 03:16 pm

Bangladesh Bank hikes farm loan disbursement target by 6.8% for FY’19

  • Published at 06:24 pm July 25th, 2018
Vietnamese farmer.jpg
A farmer harvests rice on a rice paddy field outside Hanoi, Vietnam, June 7, 2018 Reuters

In the last fiscal year, the banks have disbursed 104.87% of the target

The central bank has raised the farm loan disbursement target to Tk21,800 crore for the fiscal year 2018-19 (FY19), which is 6.8% higher than that of FY18.

Bangladesh Bank Deputy Governor SM Moniruzzaman announced the target while unveiling the agriculture and rural credit policy for the current fiscal year at a meeting at the central bank headquarters in Dhaka on Wednesday.

“We have set the target considering the increasing demand for agriculture and rural credit with a view to mitigating income inequality of the poor and accelerating sustainable economic development of the country,” he said.

Some new concepts have been added to the current agricultural credit policy to ensure national food security and to develop a sustainable agricultural credit system.

About 60% of the credit would have to be disbursed in the crop sector, and 10% for fisheries and livestock sector, while the rest of the credit would have to be disbursed for agriculture machinery, poverty reduction, farming on floating systems, turkey farming and other sectors, Moniruzzaman further said.

“As highest rate of interest for all types of credit have been set at 9% from July 1, the highest interest for agriculture and rural credit will also be 9%,” he added.

According to the central banks’ target, state-owned commercial and specialized banks have to disburse Tk9,810 crore by June 2019, while private commercial and foreign commercial banks have to disburse Tk11,990 crore as agriculture credit.

In the last fiscal year, the banks have disbursed an agricultural loan of Tk21,393 crore, which was 104.87% of the target of Tk20,400 crore, according to the latest data unveiled by Bangladesh Bank.

According to the central bank data, a total of 3,962,508 farmers received agriculture and rural credit in 2017-18, of whom 1,576,137 were women borrowers who received Tk6,309.58 crore.