In the first six months of the current fiscal year banks have provided 33 percent more credits to agriculture sector. They also disbursed 95 percent more credits for tractors.
This was observed in the Agricultural Credit Advisory Committee (ACAC) meeting held under the chairmanship of Dr Ishrat Hussain, Governor, State Bank of Pakistan, on Friday to review the half-yearly performance of the banks in Agriculture Financing.
The meeting was attended by the presidents/chief executives of banks, senior officials of federal/provincial governments, farmer associations and Pakistan Banks Association.
The Chairman appreciated the impressive performance of banks in the disbursement of Rs 33 billion for agriculture sector during the first six months of the current fiscal year (July-December, 2003) compared with Rs 25 billion during the same period last year showing a significant rise of 32 percent.
The five big commercial banks - NBP, HBL, UBL, MCB, ABL - disbursed Rs 15 billion, compared with Rs 10 billion last year registering an increase of 50 percent.
The Committee also appreciated the improvement by the domestic private banks (DPBs) in this field.
The loan recovery of the five major commercial banks recorded about 69 percent compared with 65 percent during the same period last year while DPBs recovered 80 percent of the recoverable loans.
The Committee expressed satisfaction and appreciated the efforts of the banks in the field of tractor financing.
Banks disbursed Rs 2.5 billion for the purchase of 8,097 tractors during July-November, 2003 compared with Rs 1.3 billion for the purchase of 4,573 tractors during the same period last year depicting a record increase of 95 percent in amount and 77 percent in the number of tractors financed.
It was reiterated that tractor leasing is already allowed in the SBP credit scheme.
The Committee also reviewed the salient features of the Revolving Credit Scheme and observed that the three-year revolving credit limit under the scheme would further facilitate the farmers who can now avail themselves the credit easily from the banks through one time documentation.
The Chairman urged the participating banks to implement the Revolving Credit Scheme in letter and spirit to provide maximum benefit to the farmer community. The Committee urged all the banks to further increase their loan portfolio for agricultural purposes particularly in Balochistan, Sindh and Azad Jammu and Kashmir (AJK).
The Committee also appreciated the SBP efforts for creating awareness and dissemination of knowledge and experience among the farming/banking community through conducting specialised training throughout the country last year.
The Committee was informed that the 2nd phase of SBP training has been scheduled for Muzaffarabad, Gujranwala, Islamabad, D I Khan, Multan, Bahawalpur and Sialkot during January-April 2004.
It was proposed that similar training may also be conducted/arranged by the banks themselves with the help of Pakistan Banks Association and State Bank of Pakistan.