Poor fish farmers' accessibility to credits: A review

Fisheries sector contributes about 5.3% to GDP and about 6% of the export earnings of Bangladesh. There are about 4.1 million ha of inland water bodies in Bangladesh. However, over last two decades the catch from inland capture fishery has decreased due to filling of wet lands and other anthropogenic reasons. Accordingly, the production of inland fish has decreased not only for the decrease of water bodies but also due to irrational catch of fish fries, brood fishes and use of current nets for fishing. Significant responses from the fisheries entrepreneurs have not been received for the small loan scheme of the Bangladesh Bank. The bank could not disburse more than Tk. 500 million under the scheme. The total revolving credit under the scheme was Tk. 1,000 million with the assistance from the World Bank. The business houses having fixed assets of value not more than Tk. 10 million will be eligible to borrow from this fund. About Tk. 0.2-5.0 million can be borrowed as term loan and working capital from Bangladesh Bank through commercial banks. The loan was given to the commercial banks at 5% interest (bank rate) and the commercial banks shall also bridge finance to the entrepreneurs at a lower rate of interest. Working capital time limit is for a maximum of 1 year with half yearly rest, mid-term loan maximum of 3 years in 5 installments and with 6 months grace period and long-term loan maximum of 5 years in 9 installments with 6 months grace period.