Bangladesh Bank has set a target of distributing Tk 60,000 crore in agricultural and rural loans for the current fiscal year, which is an increase of approximately 54 percent compared to the agricultural loan target of the previous fiscal year.

The target for the previous fiscal year was set at Tk 39,000 crore.

Furthermore, fingerling production in hatcheries, poultry chick production, and camel rearing have been brought under the agricultural loan program.

The Agricultural and Rural Credit Policy and Program was announced on Monday (August 17) at the Jahangir Alam Conference Hall of Bangladesh Bank's head office.

Bangladesh Bank Governor Md. Mostakur Rahman announced the new policy. Deputy governors, executive directors, directors, and other relevant officials of the central bank were present on the occasion.

Managing directors of various public and private banks also attended the event.

Later, through a press release, Bangladesh Bank detailed the disbursement target, sectors, and new provisions of the agricultural credit for the current fiscal year.

Out of the new target, Tk 20,495 crore has been allocated for state-owned commercial and specialized banks, while Tk 39,505 crore has been earmarked for private and foreign commercial banks.

Bangladesh Bank stated that the new agricultural and rural credit program will play a vital role in increasing food production and employment by ensuring an adequate supply of credit to the agricultural sector, boosting the income of the rural population, and controlling inflation.

To ensure that loans reach genuine farmers, several changes have been made in the new policy.

Provisions have been made to utilize certifications from local agricultural extension officers, sub-assistant agricultural officers, fisheries officers, and livestock officers as verification for collecting farmer cards.

Instructions have also been issued to disburse rural loans to farmers engaged in income-generating activities in the crop and grain sectors. Additionally, the prescribed limit on the number of members in farmers' groups has been relaxed.

The mandatory requirement of possessing or issuing a passbook for agricultural loan disbursement has also been eased.

At the same time, the requirement to obtain Bangladesh Bank's consent prior to loan disbursement has been relaxed in certain cases.

For loan disbursements of up to Tk 5 lakh in the fisheries and livestock sectors, instructions have been given to prioritize women and marginalized farmers.

To facilitate financing for these farmers, the use of alternative collateral instead of land or immovable property has been recommended.

The new policy provides opportunities for individual or group farmers and breeders to obtain loans in the aquaculture and livestock sectors.

Fingerling production in hatcheries, poultry chick production, and camel rearing have newly been included under the agricultural loan program.

The refinancing policy incorporates provisions for a Tk 10,000 crore refinancing fund and a Tk 3,000 crore refinancing fund.

To address the impacts of climate change, the new policy also introduces provisions to bring customers under insurance coverage for agricultural loans.

The insurance facility is to be provided based on a mutual relationship and coordination between the bank and the customer.

To ensure uninterrupted credit disbursement to the agricultural sector throughout the year, initiatives have been taken to set loan repayment deadlines for the cultivation of several fruits.

Repayment schedules will be determined based on the cultivation period and post-harvest collection times for bananas, papayas, mangoes, lemons, guavas, and lychees.

Bangladesh Bank believes that an adequate supply of funds in the agricultural and rural sectors is essential for poverty alleviation, employment generation, increasing the income of marginalized and poor populations, and ensuring a sustainable economy.

By increasing the production and supply of agricultural products, the new agricultural and rural credit policy will play an effective role in controlling inflation and boosting employment and income for the rural population.