KARACHI:(B – Trams) The State Bank of Pakistan (SBP) has enhanced the indicative credit limits for agriculture financing to align the amount of loans with input requirements.
According to the revised indicative agriculture credit limits shared by Wednesday, per acre limit for rice has been increased to Rs70,000 for the current calendar from Rs45,000 per acre in 2019.
All five major crops’ limits were substantially increased. The wheat indicative price per acre increased by 50 per cent to Rs60,000 in the year 2022 from Rs40,000 in 2019.
The indicative credit limit of cotton was increased to Rs75,000 from Rs52,000 in 2019; sugar cane Rs105,000 from Rs73,000; maize Chybrid) Rs78,000 per acre from Rs55,000 and maize Rs65,000 from Rs45,000 in 2019.
Per acre indicative credit limits for five major and other minor crops have been calculated using the estimation methodology. The banks may use these indicative limits to estimate credit requirements of each borrower or Further, banks may use these indicative limits for the premium claimsof Crop Loan Insurance Scheme (CLIS) and variation from these limits will be justified in the CLIS premium claim formats accordingly.
The enhanced indicative credit limits for production and development loans of farm and non-farm sector will directly benefit agriculture borrowers, who will now be able to obtain more credit frombanks and in turn enhance agriculture productivity through adequate use of inputs,” the SBP said The central bank added that this will also enable banks to align the amounts with the actual customer. loan requirements of farmers and result antly enhance the flow of agriculture credit.
The indicative credit limits serve as a guideline for banks to assess the credit requirements of agriculture borrowers while sanctioning credit limits. Banks may, however, make adjustments based on prevailinging market conditions, local prices of inputs, and repayment capacity of borrowers, said the SBP.
The revised indicative credit limits will also facilitate provincial planning departments in estimating the total financial and credit requirements of respective provinces/regions for farm and non-farm sectors.
Minister for National Food Security and Research Syed Fakhr Imam has sought a dedicated meeting with the Mbistry of Finance and SBP to formulate a clear roadmap on the enhancement of agriculture credit to the farming community.
The minister, who chaired a meeting of the Coordination Committee on the Agriculture Transformation Plan (ATP) on Wednesday, asked the provinces and federal ministries to expedite the pace of implementation of ATP interventions to transform the agriculture sector as per the vision of the prime minister.
Also the federal Government under Kamyab Kissan package for farmers , its to Grants 50,000 Loans by June With a total Disbursement Of Rs 5 billion .