Bangladesh Bank (BB) has launched a refinance scheme of Tk 30 billion for the agriculture sector to help the sector recover from the disruption caused by the Covid-19 pandemic.
The central bank announced the fund on Tuesday. Under the refinance project titled ‘Special refinancing scheme in Agriculture Sector (Phase II) for the fiscal year 2021-22”, BB will supply the fund to banks for disbursement as farm credit by June 30, 2022.
Banks will sign participation agreements with the central bank to get funds from this refinance scheme.
Marginal and landless farmers, vegetable growers, flower growers, oilseed cultivators, maize farmers, spice cultivators and small businesses in the poultry, livestock and fisheries sector will get loans from the refinance scheme at a four per cent interest rate.
The participatory banks will have to disburse 30 per cent of the loans of the refinance scheme to the crops and food grain sector.
The loan disbursement and recovery period would be 12 to 18 months with a grace period of 3 to 6 months.
The banks will have to maintain separate records for agriculture loan disbursement under the refinance scheme and send those to the central bank as per the prescribed format.
The farm credit disbursement target was 7.98 per cent higher than the target of Tk 262.92 billion fixed for FY21.