Cattle fatteners to get loans from Tk 5,000cr BB fund

The Bangladesh Bank yesterday said cattle fatteners or beef producers would get loan from its Tk 5,000 crore refinance scheme formed for ensuring food security.

The announcement comes at a time when cattle fattening for beef production has been growing in Bangladesh amid growing interest among farmers owing to higher prices of beef.

Last year, farmers reared 41 lakh cattle targeting to sell during Eid-ul-Azha, which accounts for half of annual demand for animals for meat.

A total of of 33.42 lakh cattle were fattened under the special regime, which involves nutritious diets and movement restrictions, in 2017, according to the Department of Livestock Services.

In November last year the central bank formed the refinance scheme to ensure food security as the banking regulator thinks the world might face a food crisis in the days to come.

The loans will have to be disbursed to the sectors such as the cultivation of rice, vegetables, fruits and flowers, fish and poultry farming, and milk production, it said at that time.

In a notice yesterday, the BB said the cattle fatteners have been brought to the sectors and they would be eligible for loans under the scheme.

Under the central bank scheme, farmers will be able to take loans at 4 per cent interest.

Banks will be allowed to take loans at 0.5 per cent interest from the fund, meaning that they will enjoy an interest margin of 3.5 per cent after disbursing the fund to the farmers.

Farmers will have to repay the fund within 18 months, including a grace period of three months.

Growers who cultivate paddy, vegetables, fruits and flowers will be able to get Tk 2 lakh in loans without any collateral. 

Mohammad Shah Emran, general secretary of Bangladesh Dairy Farmers' Association, said around 800,000 farmers are engaged in dairy and bulls rearing in the country.

Despite the inclusion of cattle fattening in the list of low-cost financing, he said, marginal and small farmers might not be able to avail the low-interest loans for beef production.

"Scheduled banks demand trade licence, two-year experience and bank statements for lending which small farmers usually do not have. So large farmers will benefit from the low-cost loan under the refinance scheme," he said.

Emran said the Bangladesh Bank should ensure that small producers avail the loan at easy terms.

Bankers can extend the loans visiting farms and based on guarantee from farmers instead of asking for banking and other documents, he added.