Nine banks disburse less than 10% of target in Jul-NovDisbursement of farm loans by banks in the first five months of the fiscal year slightly fell while nine banks disbursed a meagre amount. Between July and November, banks disbursed 33.99 per cent of their total farm loan target, down from 34.43 per cent a year earlier, according to the central bank’s latest data. The central bank always puts pressure on banks to fulfil the disbursement target to the farm sector. Considering that agriculture is a priority sector, the central bank usually sets the interest rate on farm loans at 2-3 per cent less than the major credit products of banks. Of the total loans disbursed in the farm sector, 30 to 35 per cent are typically disbursed through NGOs and MFIs, as per the central bank’s data.

Source: Dhaka Tribune December 23, 2020 19:18 UTC