ISLAMABAD: The Economic Coordination Committee (ECC) has directed the State Bank of Pakistan (SBP) to immediately notify a new risk coverage scheme designed to support small farmers and underserved regions. Officials said the scheme aims to correct a long-standing imbalance in agricultural financing, where large farmers receive the bulk of credit while smallholders remain neglected.
According to a Finance Division briefing, nearly 97 percent of agri-credit is currently disbursed in Punjab and Sindh, while only 3 percent reaches Khyber Pakhtunkhwa, Balochistan, Azad Jammu & Kashmir and Gilgit-Baltistan. Within this structure, large farmers—just 7 percent of total borrowers—secure 68 percent of loans, while small farmers, who make up 93 percent, are left with only 32 percent.
The newly approved scheme is designed to incentivise banks to lend more to small and subsistence farmers in Punjab and Sindh, while extending full coverage to farmers in underserved provinces and regions. The initiative is expected to bring more than 750,000 new borrowers into the formal credit system within three years, offering them access to financial resources previously out of reach.
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Govt Approves Risk Coverage Scheme for Small Farmers
ISLAMABAD: The Economic Coordination Committee (ECC) has directed the State Bank of Pakistan (SBP) to immediately notify a new risk coverage scheme designed to support small farmers and underserved regions. Officials said the scheme aims to correct a long-standing imbalance in agricultural financing, where large farmers receive the bulk of credit while smallholders remain neglected.
According to a Finance Division briefing, nearly 97 percent of agri-credit is currently disbursed in Punjab and Sindh, while only 3 percent reaches Khyber Pakhtunkhwa, Balochistan, Azad Jammu & Kashmir and Gilgit-Baltistan. Within this structure, large farmers—just 7 percent of total borrowers—secure 68 percent of loans, while small farmers, who make up 93 percent, are left with only 32 percent.
The newly approved scheme is designed to incentivise banks to lend more to small and subsistence farmers in Punjab and Sindh, while extending full coverage to farmers in underserved provinces and regions. The initiative is expected to bring more than 750,000 new borrowers into the formal credit system within three years, offering them access to financial resources previously out of reach.
