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Muhammad Ashraf Khan Director, Agricultural Credit Department, SBP

Farm Sector Production LoanDevelopment LoanNon-Farm SectorWorking Capital Term Loan. 2. Types of Agri. Credit Requirements. Specialized BanksZarai Taraqiati Bank Ltd.Punjab Provincial Cooperative Bank Ltd.Microfinance BanksCommercial Banks NGOs-MFIs Informal Credit Providers. 3. Sources of Agri. Credit .

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Muhammad Ashraf Khan Director, Agricultural Credit Department, SBP

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    1. Muhammad Ashraf Khan Director, Agricultural Credit Department, SBP

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    3. Specialized Banks Zarai Taraqiati Bank Ltd. Punjab Provincial Cooperative Bank Ltd. Microfinance Banks Commercial Banks NGOs-MFIs Informal Credit Providers

    4. Agri. credit disbursement has increased to Rs 212 billion in 2007-08 from Rs 45 billion in 2000-01 Target for 2008-09 is Rs 250 billion, out of which banks have disbursed Rs 130 billion during Jul 2008 - Feb 2009 4

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    9. Non availability of passbooks, issues of fake passbook and non-cooperation of revenue authorities with the banks and borrowers, and non-automation of land record Lack of awareness of farmers regarding financial services being offered by banks Uneconomic size of farms and uneven geographical distribution of agri. credit Frequent demand for write-offs/waivers High NPLs on agri. loans Weak infrastructure, research and limited capacity of the government departments to disseminate the research findings to farmers at the grass roots The recovery through sale of agri. land is almost impossible for banks Market distortions by ZTBL due to lending at lower than market rate Lack of absorption capacity of less developed provinces Sindh, NWFP and Baluchistan Farmers’ limited access to the information of latest farming techniques Shortage of water, quality seed, fertilizers, etc. Ineffective implementation of government’s support prices and timely purchase by PASCO and other public sector enterprises Lack of efficient farming practices and record keeping & financial knowledge of the farmers

    10. Based on the discussions with major agri. lending banks, the following measures by the government will facilitate in developing an enabling environment and supporting infrastructure for improving the access of agri. credit through banking system: - Establishment of Credit guarantee scheme for agri. financing to small farmers. Automation of land record and facilitation in issuance of the Agri Pass Books, other Revenue Documents (Naqal Khasra Gardawari, etc.), charge creation and redemption process, etc in a timely manner. Removal of withholding tax on cash withdrawal from agri. loan accounts of the farmers. Awareness and education of farmers about banks financial services and related information on cropping. Implementation of Loans for Agricultural, Commercial & Industrial Purposes Act, 1973 for recovery of banks’ Non Performing Loans through provincial revenue departments (Board of Revenues) as Arrears of Land Revenue, as per provisions of law.

    11. Thanks 11

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