Disbursement of agricultural and rural loans increased by 27.65 per cent in the first three months (July-September) of the current fiscal year 2026-27, although the outstanding and recoverable amounts of loans in the sector also rose during the period.
However, overdue agricultural loans declined by 3 per cent and classified loans by 5.17 per cent compared with the same period last year.
The figures were revealed in a report prepared by the Agricultural Credit Department of Bangladesh Bank.
According to the report, 58 banks disbursed a total of Tk 10,836.97 crore in agricultural and rural loans up to September 2026, compared with Tk 8,489.47 crore during the corresponding period of the previous fiscal year.
The disbursement increased by Tk 2,347.50 crore, or 27.65 per cent, year-on-year.
The government has set an agricultural and rural credit disbursement target of Tk 60,000 crore for FY27. Banks achieved 18.06 per cent of the annual target during the first quarter.
Private commercial banks accounted for the largest share of agricultural and rural loan disbursement, contributing 38.24 per cent of the total. Specialised banks accounted for 29.67 per cent, Islamic banks 17.67 per cent, state-owned commercial banks 9.73 per cent and foreign banks 4.69 per cent.
In terms of progress against annual targets, specialised banks performed the best, disbursing 23.73 per cent of their targets by September.
Foreign banks achieved 19.74 per cent, Islamic banks 19.30 per cent, private commercial banks 15.34 per cent and state-owned commercial banks 15.19 per cent of their respective targets.
Sector-wise, crop production received the largest share of agricultural and rural credit. By September, Tk 5,069.98 crore, or 46.78 per cent of total disbursement, had gone to this sector.
Livestock and poultry farming received the second-largest share, amounting to Tk 3,253.01 crore, or 30.02 per cent.
In addition, Tk 1,388.34 crore, or 12.81 per cent, was disbursed to fisheries, while Tk 1,003.01 crore, or 9.26 per cent, went to non-farm rural activities.
Banks also disbursed Tk 91.05 crore for irrigation and agricultural equipment and Tk 31.58 crore for crop storage and marketing.
Under Bangladesh Bank's policy, 55 per cent of agricultural and rural credit is supposed to go to crop production, 13 per cent to fisheries, 20 per cent to livestock and poultry farming, 2 per cent to irrigation and agricultural equipment, and the remaining 10 per cent to non-farm rural production and income-generating activities.
Alongside increased disbursement, the outstanding volume of agricultural loans also rose. At the end of September, outstanding loans in the sector stood at Tk 63,722.46 crore, up from Tk 59,500.11 crore a year earlier, representing a 7.10 per cent increase.
The amount of recoverable loans also increased to Tk 36,938.76 crore from Tk 34,257.92 crore in September last year, marking a year-on-year rise of 7.83 per cent.
Loan recovery, however, also recorded growth. Banks recovered Tk 12,176.59 crore in agricultural loans in September this year, compared with Tk 10,544.39 crore in the same month last year, an increase of 15.48 per cent.
Meanwhile, the volume of overdue agricultural loans declined. Such loans stood at Tk 21,455.83 crore at the end of September, down from Tk 22,120.06 crore a year earlier, representing a 3 per cent decrease.
Bank-wise data showed that overdue loans fell by 7.80 per cent at specialised banks and 18.20 per cent at private commercial banks.
However, overdue loans increased by 4.56 per cent at state-owned commercial banks and 97.13 per cent at Islamic banks. Foreign commercial banks had no overdue agricultural loans in September, as was the case in the corresponding period last year.
Classified agricultural loans also declined during the period. At the end of September, such loans stood at Tk 18,551.74 crore, compared with Tk 19,562.86 crore a year earlier, marking a 5.17 per cent decrease.
Classified loans declined by 12.25 per cent at specialised banks and 2.48 per cent at private commercial banks.
In contrast, classified agricultural loans increased by 5.39 per cent at state-owned commercial banks and 80.80 per cent at Islamic banks. Foreign banks reported no classified agricultural loans, according to the report.
