This directive is part of fresh instructions the State Bank has issued to all banks for streamlining agricultural lending procedures and documentation in order to ensure timely disbursement of credit to the farming community.
In a circular issued on Wednesday, the State Bank said that in consultation with banks it has revised the list of documents to be obtained against various kinds of agriculture loans and streamlined the turnaround time for loan processing to avoid unnecessary delay in sanctioning of these loans.
The State Bank asked banks to develop a comprehensive agriculture finance policy in line with Prudential Regulations duly approved by their board of directors.
Banks were asked to develop an overall annual regional agriculture portfolio plan and assign targets for disbursement, growth in outstanding portfolio and number of borrowers to respective agriculture-designated branches.
The SBP asked banks to increase significantly the number of agriculture-designated branches and agriculture credit officers in a phased manner, in proportion to the overall credit portfolio of the area and potential of agricultural activities.
Banks were also told to delegate adequate powers to each agriculture-designated branch or the nearest zonal or area office for sanctioning small agricultural loans with requisite internal control functions in place.
Published in The Express Tribune, August 12th, 2010.
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