Karachi, August 5, 2019: Commercial Banks are failed to achieve agricultural credit disbursement target for the last financial year (FY2019).
Agricultural credit target achievements in FY 2018-19 Banks made disbursements of Rs 1,174 billion or 94 percent against the ambitious target of Rs 1,250 billion set by the for 2018-19.
According to the State Bank of Pakistan, the achievement of agriculture credit disbursement is a sizable performance in Agriculture.
The current year’s disbursement is 21 percent higher than the last year’s disbursements of Rs 972.6 billion. Further, the outstanding portfolio increased to Rs 562.4 billion on end June 2019 registering a growth of 20 percent compared with the last year’s position of Rs 469.4 billion.
Similarly, the agricultural credit outreach has increased to 4.01 million farmers or 91 percent against a target of 4.42 million farmers at end June 2019, recording growth of 8% from 3.72 million farmers at end June 2018.
To achieve these numbers, SBP adopted a multifaceted strategy and made concerted efforts
The achievement could be made due to the integrated efforts of federal/provincial governments, SBP, financial institutions, and other stakeholders. Further, the efforts included rigorous follow up with the top management of banks and agriculture.
The credit heads and conducting regular follow-up meetings with regional management were instrumental for target monitoring. Conducting regular farmers’ awareness & financial literacy programs across the country, initiation of one window operation in KPK and holding job fairs for
Graduates in underserved provinces were also helpful. Moreover, the support of SBP BSC field offices in monitoring the district/regional targets was also supportive.
The detailed credit performance reveals that during FY 2018-19, five major commercial banks collectively disbursed
Moreover, Microfinance Banks (MFBs) as a group have achieved 98.7 percent by disbursing
Similarly, the Microfinance Institutions/Rural Support Programs collectively achieved 97.1 percent of their targets by disbursing Rs 34.0 billion to small and marginalized farmers during FY 2018-19.
Five Islamic Banks as a group achieved 78.8 percent of their annual target of Rs 50.0 billion by disbursing Rs 39.4
Further, in order to mobilize the Islamic Windows of commercial banks for agricultural financing, the disbursement targets of Rs 50.0 billion were assigned 2018-19.
Accordingly, the windows of commercial banks as a group disbursed Rs 32.7 billion or 65.4 percent of the annual targets to faith sensitive clients during FY 2018-19.
