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The central bank is likely to toughen its stance against the banks whose farm credit disbursement continues to weaken.
The overall disbursement of agriculture loans has flattened.
The farm loan disbursement grew by only 0.31 per cent to Tk 162.63 billion in the July-March period of the current fiscal year (FY) from Tk 162.14 billion in the same period a year ago, according to the central bank's latest statistics.
"The disbursement of farm credit has not increased significantly yet due to the unwillingness of some banks in both the public and private sectors," a senior official of Bangladesh Bank (BB) told the FE Thursday.
He also said the central bank will take action against the banks, if they fail to achieve their farm credit target by the end of this fiscal.
"We may impose different policy restrictions on the banks if farm loan disbursement performance remains weak by the end of this fiscal for the expansion of their business," the central banker hinted.
Of the total amount, Tk 77.57 billion was disbursed by eight public banks and the remaining Tk 85.07 billion by private commercial banks (PCBs) and foreign commercial banks (FCBs).
All the banks have achieved more than 74 per cent of their annual agricultural loan disbursement target for FY 2018-19. The target has been fixed at Tk 218 billion.
The recovery of farm loans rose to Tk 170.14 billion during the period from Tk 153.95 billion, the BB data showed.
Earlier in January, the central bank asked 30 both foreign and local private banks to achieve agro-credit disbursement target by the end of this fiscal.
The central bank had also asked eight state-owned banks to continue their efforts to achieve the target by the end of this fiscal.
The eight state-owned banks are Sonali Bank Limited, Janata Bank Limited, Agrani Bank Limited, Rupali Bank Limited, BASIC Bank Limited, Bangladesh Development Bank Limited (BDBL), Bangladesh Krishi Bank (BKB) and Rajshahi Krishi Unnayan Bank (RAKUB).
"We're working continuously to achieve the farm credit disbursement target by the end of FY'19," another BB official noted.