Financing the farmers: Loans to agricultural sector surge by 13.11%

Disbursements amount to Rs255 billion from July 2011 to May 2012.

KARACHI: Agricultural credit disbursement by banks surged by 13.11% on year-on-year basis to Rs255.027 billion in the first eleven months of the fiscal year 2011-12. In absolute terms, disbursement of credit to the agriculture sector increased by over Rs29.566 billion in July-May, 2012 when compared with total disbursement of Rs225.461 billion in the same period of the last fiscal year.

Overall credit disbursement by five major commercial banks including Allied Bank Limited, Habib Bank Limited, Muslim Commercial Bank Limited, National Bank of Pakistan and United Bank Limited stood at Rs132.385 billion in July-May, 2012 compared with Rs123.100 billion in July-May, 2011 depicting an increase of Rs9.285 billion or 7.54%.

Zarai Taraqiati Bank Limited, the largest specialised bank, disbursed a total of Rs54.174 billion in July- May, 2012, down by 0.34% when compared with Rs54.359 billion disbursed in the same period of the last fiscal year. Punjab Provincial Co-operative Bank Limited disbursed Rs6.826 billion in July-May, 2012 up 38.69% when compared with Rs4.921 billion disbursement in the same period of the last fiscal year.

Fourteen domestic private banks also loaned a combined amount of Rs51.678 billion in July-May, 2012 up by 19.96% compared with Rs43.081 billion disbursed in the same period of the last fiscal year.

Five Microfinance banks including Khushhali Bank, NRSP Microfinance Bank, The First Microfinance Bank, Pak Oman Microfinance Bank and Tameer Microfinance Bank. disbursed a total of Rs9.963 billion in July-May, 2012 period.

It may be pointed out that the State Bank of Pakistan for the first time has given an indicative target of Rs12.20 billion to microfinance banks for disbursement of credit to agriculture sector during the current fiscal year.

Published in The Express Tribune, June 20^th, 2012.