Interest-free solar tube well scheme in final stages

ISLAMABAD: The modalities for implementation of interest-free Solar Tubewell Financing Scheme are being finalised and under which federal government would concur to cover mark-up cost on the behalf of farmers.

The interest free loan scheme for small farmers (having land holding of up to 12.5 acres) for installation of 30,000 solar powered tube wells over a period of three years was announced last year.

Modalities are being finalised by the Ministry of National Food Security and Research and Ministry of Finance.

Official sources while listing initiatives taken by State Bank of Pakistan (SBP) for financial inclusion in agriculture financing during this year, on Sunday, said in order to simplify the lending process for agriculture financing, revised loan application has been introduced in consultation with banks.

The loan application form has been categorised into LAF up to Rs 1 million and LAF for over Rs 1 million.

Another step is introduction of credit culture amongst farmers through SBP’s flagship Farmers Financial Literacy Programmes (FFLP).

These programmes are very helpful in spreading financial awareness amongst target groups.  The one-day training module is specially designed for farmers to increase their understanding of banking services, credit, savings, insurance and documentary requirements for obtaining a loan etc.

In 2015-16, around 12 FFLPs were conducted across the country and attended by 390 ACOs and over 1700 farmers. As per practice, the trained ACOs will serve as master trainers to further spread financial awareness at grassroots level through engagement sessions with farmers.