Bangladesh Bank has announced Agricultural and Rural Credit Policy and Programme for the fiscal year 2021-22 with a target of disbursing Tk283.91 billion as loans.
The policy focuses on helping rural economy recover from the pandemic shocks.
The central bank released the policy on Thursday to combat the adverse effects of COVID-19 pandemic.
It also aims to achieve some prime objectives of sustainable development goals (SDGs) - eradication of poverty and ensuring safe and nutritious foods for all.
Considering the pandemic situation and the increased demand of agricultural and rural credit, the disbursement target for the state-owned and specialized commercial banks is fixed at Tk110.45 billion and for the private and foreign commercial banks is at Tk173.46 billion.
In the FY2020-21, all the scheduled commercial banks disbursed agricultural and rural credit of Tk255.11 billion against the target of Tk262.92 billion, which was around 97.03 percent of the fiscal’s target.
The agricultural and rural credits were disbursed among a total of 30,55,166 people, of which, 16,05,947 women borrowers have received about Tk92.88 billion.
Moreover, around Tk0.34 billion was disbursed among 7,796 farmers of char, haor and in underdeveloped areas of the country, the BB statement said.
The BB set some new priority areas to ensure food security of the people and to develop a sustainable agricultural credit system.
Some of them are inclusion of credit norms for rearing “Sonali Hen” under the poultry subsector, credit norms for rearing buffalo and garol sheep under the livestock subsector and reducing interest rate of agricultural credit from 9 percent to maximum 8 percent.
They also included increasing or decreasing the credit limit per acre mentioned in the crop-based credit regulations up to 15 percent in the view of the actual needs and realities of the farmers.
Among the priority areas, there are also increasing the credit limit per acre in the fish farming loan regulations and taking effective initiatives to further strengthen the supervision of loans disbursed by banks.
Bangladesh Bank had created a refinance scheme of Tk 50 billion from its own-fund for working capital-based agricultural sector to mitigate the pandemic crisis.
The tenure of the scheme ended on June 2021. Under the scheme, the scheduled banks disbursed Tk42.95 billion.
Besides, an ACD circular was issued with the instruction of disbursing agricultural credit at 4 percent concessional interest rate to ensure supply of foods in the country.