Oman Development Bank (ODB) is focusing on providing agricultural loan to farmers to support a government initiative to strengthen food security.
The loan for farmers will help achieve self-sufficiency to maintain agriculture crops and livestock, and help establish and sustain agriculture with value addition and growth in production, said a bank release.
ODB, in cooperation with the Ministry of Agriculture and Fisheries, has organised a seminar on the bank’s role in investing on developing agriculture.
Mounir bin Salem Al Hanaa’y, manager, Department of Seasonal Loans, presented a paper on the seasonal agricultural loans (Mawsimi) provided by the bank.The bank provides subsidised developmental loans for the agricultural sector in many fields, which include establishing new farms, irrigation systems, expansion and development of farms; developing and maintaining farms, drilling wells for agricultural purposes and beekeeping.
Al Hanaa’y also pointed out that the bank provides seasonal loans to fund seasonal crops, which have a short cultivation period with a fixed productive cycle. He further said the bank has fixed a maximum limit for seasonal loan at OMR50,000 and can be utilised for cultivating vegetables and fruits, including chilli, cucumber, eggplant, watermelon, melon, tomatoes, potatoes, cabbage and wheat.
Agricultural loans provided by ODB offer several advantages over other loans as it has simple procedures to get approval and the fund is disbursed directly to the owner of the agricultural land.
For applying the loan, there is no need to present quotations from product suppliers as only the area to be cultivated, the value of the agricultural produce, and the agricultural land will be taken into consideration.
Loan eligibility is estimated through the cost of cultivation for each crop or each acre of the farmed crops and it covers 70 per cent of the total cost, with a repayment period of nine months. In the first phase, 70 per cent of the sanctioned amount will be disbursed immediately after signing the contract and the rest after the first visit to the projects, to make sure that all the production requirements are complied. There will be insurance for the seasonal agriculture loans, whether the farming is conducted on land or in a greenhouse and covers natural calamities, such as floods, cold, and all the climate conditions, said Al Hanaa’y.