Staff Correspondent

The agricultural credit growth is on pace as the banks disbursed around 50.57 percent of the fiscal target in seven months.

According to the latest update from Bangladesh Bank, the scheduled banks have disbursed Tk19215 crore in seven months from July to January as agricultural and rural credit for the current fiscal year FY2024-25.

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 percent 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 percent.

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 percent in the first seven months of the fiscal year are the private sector Madhumoti Bank, Union Bank, and the foreign HSBC. The Sharia-based First Security Islami Bank has disbursed 10.59 percent. Of this, Union Bank, which had a target of Tk100 crore, has disbursed only Tk 4.89 crore in agricultural and rural loans in 7 months. And Madhumati Bank, which had a target of distributing Tk33 crore, has distributed Tk2.5 crore or 7.58 percent of the target.

In addition, the foreign HSBC Bank has distributed 8.77 percent of the target. The bank's target was Tk285 crore. The bank has distributed Tk25 crore in 7 months.

To ensure food security, the government has made it mandatory for commercial banks to distribute at least 2 percent 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 percent 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 percent of the loan disbursed. And at least 15 percent 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 percent 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.