BB announces loan scheme to aid farmers

Bangladesh Bank (BB) has unveiled an Agricultural Credit Policy to bolster and strengthen the country's vast agricultural sector. The new policy, announced on Tuesday (12 August 2025) targets expanded rural financing and sustainable agro-growth.  

The central bank's announcement is an ambitious agenda to expand money lending facilities for rural people whose livelihood for the most part depends on agriculture. Another goal of this loan scheme is to promote sustainable farming practices, and enhance financial inclusion in the agricultural sector.

The policy envisages upgraded loan distribution targets, expanded coverage for marginal farmers, and a stronger push for climate-resilient agricultural investment. Bangladesh Bank's Agricultural Credit Department (ACD) has released the Agricultural Credit Policy and Program for the financial year 2025-26, focusing on improving access to finance for rural communities and ensuring sustainable agricultural development.

The policy mandates all scheduled banks to prioritize lending to small and marginal farmers, agricultural entrepreneurs, and women engaged in farming. The central bank has set a higher disbursement target compared to the previous fiscal year, reflecting the government's commitment to food security, rural poverty alleviation, and agricultural modernization. Special emphasis has been placed on financing crops, livestock, fisheries, and agro-based industries, with a view to creating employment opportunities and increasing productivity. In line with the country's climate adaptation strategy, the policy encourages banks to allocate more funds for climate-smart agriculture, irrigation efficiency projects, and renewable energy integration in farming. It also highlights the need for capacity-building programs for farmers to adopt modern technology and improve yields.

The ACD has also instructed banks to maintain transparency in loan disbursement processes, minimize procedural delays, and ensure that agricultural loans reach the intended beneficiaries without middlemen interference. Monitoring and reporting mechanisms have been strengthened, with quarterly performance evaluations to be conducted by the central bank. With the introduction of the FY2025-26 Agricultural Credit Policy, Bangladesh Bank aims to accelerate agricultural growth, improve rural livelihoods and strengthen the resilience of the sector against economic and environmental challenges.

Economists have expressed hope that the new policy for assisting farmers with financial aid will turn out to be very much conducive for Bangladesh's agricultural arena if the tenets of the policy get properly implemented. 

Bangladesh produces a variety of agricultural products such as rice, wheat, corn, legumes, fruits, vegetables, meat, fish, seafood, and dairy products.  Rice is the main staple in the Bangladeshi diet.  Lack of arable land and limited natural resources increase the importance of developing new agricultural technologies, such as salt tolerant or submergence tolerant seed varieties, to help increase productivity and meet future demand.  Floods, cyclones, and biotic-abiotic stress can also affect agricultural productivity levels and incomes.

Although Bangladesh imports bulk commodities such as wheat, soybeans, and pulses, there are niche segment opportunities for high-value agricultural product imports, particularly in more affluent urban centers such as Dhaka and Chittagong.  Strong consumer demand exists for imported fresh fruits, tree nuts, and dairy products, as well as processed food products.