The central bank set on Thursday an agriculture credit target of Tk 204 billion for the banks to disburse during the current fiscal year.
The loan was estimated to be 16.24 per cent higher than that of the last fiscal year's target, but nearly Tk 5.99 billion lower than the disbursement of the last fiscal year.  
Bangladesh Bank (BB) unveiled the agriculture and rural credit policy and programme for the fiscal year (FY) 2017-18 at press conference at its headquarters in the capital.
"We've fixed an achievable target," deputy governor SM Moniruzzaman said, announcing the policy.
Of the target, state-owned commercial banks get a target of Tk 30.10 billion for disbursement in the fiscal year (FY) 2017-18 while specialised banks Tk 65.80 billion, private commercial banks Tk 103.27 billion and foreign commercial banks Tk 4.83 billion.
Under the existing provisions, if any bank fails to achieve its target, it will have to deposit the undisbursed amount of the target with the BB without any interest.
The deposit would be refunded in the following fiscal year subject to achieving 100 per cent of the current fiscal year's disbursement target.
Meanwhile, the disbursement of farm credit exceeded the target in the last fiscal year.
All the banks have achieved nearly 120 per cent of their total annual agriculture loan disbursement target of Tk 175.50 billion for the FY'17, the press conference was told.
The overall disbursement of farm credit increased by nearly 19 per cent or Tk 33.52 billion to Tk 209.99 billion in the FY'17 from Tk 176.46 billion in the previous fiscal year.
The BB deputy governor said the central bank has already slashed the maximum ceiling of agriculture credit rate by 1.0 percentage point from 10 per cent to 9.0 per cent, considering it a priority sector. The new rate came into effect from July 1 last.
"We hope that the policy will help minimise the income inequality of the rural poor and achieve sustainable economic development," Mr. Moniruzzaman said, seeking supports from all concerned.
He suggested the banks to provide the loans with their own windows instead of the network of NGOs (non-government organisations) so that the farmers receive such loans at lower interest rate.
The micro-credit regulatory authority (MRA) has already formed a committee to slash the interest rate on agriculture loan provided by the NGOs, said Ashok Kumar Dey, BB executive director, while replying to a question about the rates charged by the NGOs.
"The committee is still working," he said.
Among others, Manoj Kanti Bairagi, general manager of the agriculture credit department of BB, also spoke on the occasion.
siddique.islam@gmail.com [Read More]

—–
Source: The Financial Express