NN Online:
Banks are maintaining steady growth in agricultural credit disbursement, achieving 50.57 per cent of the fiscal year’s target within the first seven months.
According to the latest update from Bangladesh Bank (BB), the scheduled banks have disbursed Tk 19,215 crore in seven months from July to January as agricultural and rural credit for the current fiscal year FY 2024-25.
The central bank has set an agricultural and rural credit target of Tk 38,000 crore for banks in the FY2024-25 to boost the country’s food production. In the first seven months, the banks have disbursed loans of Tk 19,215 crore, which is 50.57 per cent of the target.
However, two banks have not been able to disburse any loans during this period. The loan disbursement amount of the three banks is less than 10 per cent.
These banks have not been able to disburse any loans in the agricultural and rural sectors in the first seven months. The two banks are the private sector Padma Bank and the foreign-owned Woori Bank.
In addition, the banks that disbursed loans of less than 10 per cent in the first seven months of the fiscal year are the private sector Modhumoti Bank, Union Bank, and the foreign HSBC. The Sharia-based First Security Islami Bank has disbursed 10.59 per cent. Of this, Union Bank, which had a target of Tk 100 crore, has disbursed only Tk 4.89 crore in agricultural and rural loans in 7 months. And Modhumoti Bank, which had a target of distributing Tk 33 crore, has distributed Tk 2.5 crore or 7.58 per cent of the target.
In addition, the foreign HSBC Bank has distributed 8.77 per cent of the target. The bank’s target was Tk 285 crore. The bank has distributed Tk 25 crore in 7 months.
To ensure food security, the government has made it mandatory for commercial banks to distribute at least 2 per cent of the total loans to the agricultural sector to ensure the supply of money to agriculture and agriculture-related activities. Bangladesh Bank has made a provision for fines for banks that do not distribute agricultural loans according to the target.
Bangladesh Bank said banks will have to provide at least 13 per cent of the target loan to the fisheries sector in the current fiscal year. In the first seven months, the amount of loan disbursed to this sector stood at Tk 1,715 crore, which is 14.33 per cent of the loan disbursed. And at least 15 per cent of the target loan is to be provided to the livestock sector. During the period under review, Tk 4,664 crore has been disbursed to the livestock and poultry sector, which is 12.27 per cent of the target.
In addition, at the end of seven months, the banks have disbursed Tk 7,31 crore for poverty alleviation, Tk 9,101 crore for the crop sector, Tk 1,48 crore for the purchase of agricultural machinery, Tk 136 crore for the purchase of irrigation machinery, Tk 67 crore for the grain storage and marketing sector, and Tk 2,910 for fish farming.
