Loan disbursement to the agriculture sector witnessed a rapid growth to stand at Tk 26,929.59 crore in the July-April period of the current fiscal year, up 13.35 percent over that in the corresponding period of the previous fiscal.
In the ten months of the current fiscal year, banks disbursed 87.40 percent agriculture loans of the total annual disbursement target, according to the latest data of the Bangladesh Bank.
However, in the first 10 months of the previous fiscal year 2021-22, Tk 23,756.72 crore was disbursed among farmers, which was 83.68 percent of the total target of that time.
Officials of Bangladesh Bank said that agriculture is one of the driving forces of the country's economy.
Despite the global pandemic Corona and Russia-Ukraine situation, demand for agricultural products has increased globally, they said, adding that for this reason, Bangladesh Bank is trying to provide necessary financing in agriculture.
Experts said industrial loan disbursement was very low when the pandemic was at its peak, putting a brake on investment in various sectors. But due to the government's focus on keeping food production unaffected, disbursement of loans increased in the agriculture sector, they added.
However, 2 percent of the total loans disbursed by commercial banks are disbursed as agricultural loans.
But many of these banks do not have enough infrastructure to distribute loans in rural areas, they distribute loans through NGOs.
Besides, all the loans distributed by Bangladesh Agricultural Bank and Rajshahi Agricultural Development Bank are agricultural loans.
In addition, Microcredit Regulatory Authority (MRA) is the central body to monitor and supervise microfinance operations of non-governmental organizations in Bangladesh. It was created by the Government under the Microcredit Regulatory Authority Act. License from the Authority is mandatory to operate microfinance operations in Bangladesh as an NGO.
MRA disburses a major share of agricultural loans.
Recently, Association of Bankers, Bangladesh Limited (ABB) said that every bank is increasing manpower for agricultural loans. In the future, the banks will distribute these loans directly to the farmers. For this reason, each bank has set a target.
In the first 10 months of the current fiscal year, eight state-owned commercial banks distributed Tk 10,934 crore, which was 93.79 percent of their total target.
In addition, domestic and foreign banks have distributed Tk 15,995 crore or 83.51 percent of the target.
The target of loan disbursement during the fiscal year 2021-22 was Tk 28,391 crore. During the time, banks disbursed more than the target agricultural credit, which was about 102 percent of the total target.
However, in the current fiscal year 2022-23, the agricultural loan target has been set at Tk 30,911 crore. Banks have disbursed 87.40 percent of the target loans in the first 10 months.
In the current fiscal year, eight state-owned banks have a target of Tk 11,758 crore, private banks have a target of Tk 18,382 crore and eight foreign commercial banks have a target of Tk 771 crore.