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Agriculture credit ,its roles, its types Its importance ,Its impact, institutions of agriculture credit..
Total Cultivable Area Total Cultivated Area Total Irrigated Area Cultivable Area Left uncultivated
What is credit?
Permission to use another's capital. (john Stuart Mill ) The power to obtain goods or services by giving a promise to pay---------- at a specified date in the future. (Joseph French Johnson) One of the most widely published definitions is that Credit is a present right to future payment. Credit is derived from the Latin word CREDITUM meaning TRUST. So credit is a trust and credit without trust is unthinkable.
Agriculture credit/finance
Agriculture credit is the financing for agriculture related activities qInput supply qProduction qProcessing qMarketing
Under formal lenders are q Specialized banks Zarai Taraqiati Bank Limited (ZTBL) Punjab Provincial Cooperative Bank Limited(PPCBL) q Commercial banks ABL HBL MCB NBP UBL
They comprise of qillegal money lenders qFriends qRelatives qShop keepers qCommission agents
Agriculture sector is the largest sector of Pakistans economy. Its contribution to GDP is 21 %
Agriculture Manufacturing &mining Trade Public Administration & Defence
It is also the major source of the total labor force of the country i.e
(2)Tem-wise
(a)
(3)Purpose-wise
(a)Production loans (b)Development loans
Farm credit
It
is extended for the purpose of production of crops to meet working capital expenses and development of agri.land Financing for
crop inputs ,tractors/well, Farm machinery Land improvement
Non-Farm credit
It
is extended for
Financing of Livestock (Cows.Buffaloes,Goats and Sheep) Poultry-farming (Broiler,Layer and hatchery) Fisheries (Inland and marine) Forestry
Development Loans They include loans for capital items like Tractors Attachments/Implime nt Installation of T/well Improvement of agri.land Construction of godowns Orchard plantation
ACAC
It stands for Agriculture Credit Advisory committee. It was setup in 1972 to assess credit requirements of agricultural sector in order to assist NCC in the preparation of credit plan and to consider the ways and means for improving disbursement and recovery of agricultural credit together with suggesting measures for strengthening of institutional framework of agricultural credit. The Governor State Bank of Pakistan is the chairman of this committee. It consists of members from Federal/provincial Governments, Banks and chambers of Agriculture/farmers associations.
is a system of providing Agri.credit ) Latest technology ) providing at the doorstep of Supervision/guidance ) the farmers through MCO
It
was introduced in1979. It covers the entire Pakistan which covers 458 Tehsils. In addition to five major banks and two specialized istitutions.13 domestic private banks are also participating in supervised agri.credit scheme. All categories of farmers in Pakistan(owners
There are two system to avail agricultural credit ( 1) Loans under Agricultural Pass Book System
It
was introduced by federal Govt. in 1973 on the basis of PIUS In1987,this system was further amended to provide for assessment of value of land on the market price in addition to PIUS.
The printing and selling of APB is arranged by Pakistan Postal Services Corporation as prescribed in LACIP Act.1973 Its cost is Rs.20/-and they are bound in red and green covers. The fee for preparation and completion of the APB are to be paid in the form of court fee stamps at following rates
In case of land owners having land not exceeding Rs.5 subsistence holding In case of land owners having land exceeding Rs10 Subsistence holding but not exceeding economic holding In case of land owners above economic holding
There are different modes for financing various types of disbursements under Islamic Banking System since 1985. They are
Mark-up Hire-purchase Lease-financing Buy-Back Service
charges NOTE; but for the sake of uniformity , only one mode of financing i.e. is being adopted.
It is defined as
Sale
in which the margin of profit is mutually agreed upon between the buyer and seller and agreed price of the item involved is payable on a deferred basis either in lump sum or in installment
I t is a running finance from the banks on the basis of multiple crops, which becomes revolving limit, for the period of three years in single disbursement
There is no limit of land holding. Revolving limit can be renewed against 100% adjustment/repayment of previous loans without fresh documentation. There is no loan application fee at the time of renewal.
It is also called ZARKHAIZ /AWAMI ZARI SCHEME. It has played a significant role in meeting the production credit needs of small farmers timely/ satisfactorily. This is a sort of credit availability to the farmers at their door step. This enables them to purchase the required good quality inputs The farmers can avail loan for three years with one time documentation. It is carried out on every Monday Farmers up to land of 25 acres eligible for this scheme. Max. loan limit is Rs..200M. L.A. Form are supplied free of cost At focal point MCO receives loan application and process it after checking RR.