Eight new banks came under criticism yesterday for not disbursing farm loan in the first seven months of the current fiscal year 2014.
Bangladesh Bank Governor Atiur Rahman criticised them at a review meeting on agriculture loan with the commercial banks at the central bank headquarters in Dhaka.
“Of the new nine banks, eight did not disburse any farm loan in the first seven months up to January of the current fiscal year, which was not expected,” he said.
One of the major conditions for awarding licences to the new banks was to provide 5% of their total loans to the agriculture sector. “So, we may think the banks did not lend other sectors too,” he said.
Banks have disbursed farm loan of Tk8,820 crore during the July-January period, which is over 60% of the fiscal year’s total target of Tk14,595 crore, according to Bangladesh Bank.
Foreign banks have showed exemplary achievements in disbursing the loan despite not having adequate branches. They achieved 95% of target through micro finance institutions (MFIs), said the governor. Private banks have disbursed 32% of their total loan through the MFIs.
Atiur said commercial banks have disbursed farm loan 4% higher than their target for the last fiscal year and the target for the current fiscal year is 3.3% higher than the target of last year.
He asked the banks to increase lending to import-based goods like pulses, spices, oilseeds and corn so that it helps to keep the price of these goods at levels of purchasing power of general people.
