The comparative focus of private banks on agricultural credit is less, according to a study by the Bangladesh Institute of Bank Management (BIBM).
About 8 percent of the public sector banks are in agriculture, less than 2 percent of private banks. However, comparative fraud in agriculture is very low.
The revelation came through a research report unveiled at a workshop titled ‘Addressing Agriculture Through Value Chain Financing-How to Attract Banks?’ at BIBM Auditorium in Mirpur, Dhaka on Monday.
BIBM has collected reports of various types of 24 banks.
The workshop was presided over by Director General of BIBM Dr Tafic Ahmad Chowdhury.
The programme started with the welcome speech by the Director General of BIBM, Dr Taufic Ahmad Chowdhury.
He stressed on giving agricultural credit to achieve high growth.
Chairman of BIBM Executive Committee and Bangladesh Bank Deputy Governor SM Moniruzzaman was present as chief guest.
In the study workshop, BIBM chair professor and a former professor of economics department of Dhaka University D Barkat-E- Khuda; Former Managing Director of Pubali Bank and Professor Helal Ahmed Chowdhury, Professor of BiBM; Former Executive Director of Bangladesh Bank and Professor Yasin Ali, Vice President, BIBM; Chairman of the Board of Directors of Basic Bank Alauddin A Majid; Managing director of Bangladesh Krishi Bank Md. Ali Hossain Pradhan were among others present.
According to the research report, there is no diversity in agricultural sector bank loans.
An analysis of agricultural debt from 2014 to 2015 has been found that 59% of the total agricultural credit is provided in the production of crops. Only 10 percent of livestock and poultry, 9 percent in fish, and 6 percent for poverty reduction has been given. 1 percent of the loan has been given to the machinery.
And in the warehouse of grains, this rate is zero in quota. Due to the distribution of diversified loans in the agricultural sector, the desired growth is not achieved.
BIBM’s report has been asked to emphasise on value chain finance in agriculture to achieve high growth.
In addition, the report says that the comparisons of agricultural loans are less in agriculture.
SMM Muniruzzaman, chairman of BIBM Executive Committee and deputy governor of Bangladesh Bank, said Bangladesh Bank has created a separate guideline for the distribution of agricultural credit. So that agricultural credit is properly distributed in the agricultural sector. Value chain system for agricultural loans is not yet operational. But the central bank is examining the matter. It is possible to start such a system quickly.