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Agri-credit: Banks roughly accommodate aim with value of Rs598b
- Updated: August 8, 2016
Despite disastrous expansion in cultivation sector, credit upsurge continues to collect adult pace. PHOTO: FILE
KARACHI: Banks disbursed Rs598.3 billion in cultivation credit in mercantile year 2015-16, that was 16% aloft than value of Rs515.9 billion in 2014-15 and roughly met a annual aim of Rs600 billion, announced a State Bank of Pakistan (SBP) on Monday.
“It is critical to note that notwithstanding disastrous expansion of a cultivation zone due to a series of factors, agri-financing continued a augmenting movement of a past few years,” a SBP pronounced in a press release.
Outstanding portfolio of cultivation loans also rose by Rs32.3 billion to Rs345.6 billion during a finish of Jun 2016, recording a 10.3% expansion compared to a prior year. The series of farmers served by banks also increasing from 2.2 million to 2.4 million.
“The feat of agri-credit value aim was an ascending charge for a lending institutions due to several financing issues and real-side hurdles like low prolongation of vital money crops generally cotton, meridian change, fluctuation in prices of agri-produce, opening in marketplace linkages and high risk notice of banks about agri-financing,” a executive bank commented.
In further to implementing several budgetary initiatives, a SBP pronounced it done accordant efforts to grasp a agri-credit value aim set by a government.
These efforts enclosed sustenance of an enabling regulatory environment, sensitising banks to adopt agri-financing as a viable business line and exploring new financing avenues such as cultivation value-chain financing, room receipt financing, execution of credit pledge intrigue for tiny and marginalised farmers and severe monitoring of bank lending performance.
Five vital banks collectively disbursed agri-loans of Rs311.4 billion or 101.9% of their annual aim of Rs305.7 billion, that was aloft by 18.4% from a Rs262.9 billion disbursed in a prior year.
Amongst these banks, National Bank of Pakistan surpassed a annual aim and reached 109.2%, Habib Bank Limited achieved 102.4% target, MCB Bank 101.8%, United Bank Limited 100.4% and Allied Bank Limited 86.9%.
Among specialised banks, Zarai Taraqiati Bank Limited disbursed Rs90.97 billion or 89.2% of a annual aim of Rs102 billion while Punjab Provincial Cooperative Bank Limited disbursed Rs10.3 billion or 82.7% of a aim of Rs12.5 billion.
Fifteen domestic private banks cumulatively achieved 93.4% of their target. Of these, Summit Bank, JS Bank, Bank Alfalah, Habib Metropolitan, Sindh Bank, Soneri Bank and Bank of Khyber surpassed their annual targets.
However, NIB Bank achieved 94.3% of a target, Bank AL Habib 88.5%, First Women Bank 87.5%, Standard Chartered 87.3%, Faysal Bank 84.7%, Askari Bank 83.9% and The Bank of Punjab 43%.
Nine microfinance banks as a organisation surpassed their annual aim of Rs40.1 billion by disbursing agri-loans of Rs53.9 billion or 134.4% during FY16.
Five Islamic banks as a organisation also surpassed their annual aim by disbursing Rs8.5 billion opposite a aim of Rs7.9 billion.
In a group, Meezan Bank, Albaraka Bank and Dubai Islamic Bank surpassed their annual targets since Bank Islami reached 96.8%.
Published in The Express Tribune, Aug 9th, 2016.
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