Farmers can now obtain bank financing by storing their agricultural produce and commodities in electronic warehouses.
Farmers might avoid selling their produce at disadvantageous pricing with a shorter shelf life in order to meet cash flow requirements for the next crop by doing so. It will also assist Pakistan in lowering its significant post-harvest losses.
IFC, the World Bank‘s private sector arm, is working with the Pakistani government to extend this facility and provide training to banks.
In this regard, Deputy Governor Sima Kamil of the State Bank of Pakistan (SBP) stated on Wednesday that the training workshop on Electronic Warehouse Receipt Financing (EWRF) for banks will be crucial throughout supporting SBP’s recent initiative to promote EWRF in the country.
She added banks will be able to obtain hands-on expertise about EWRF product development, risk analysis, price determination process, and international best practices at a two-day specialized training event. She urged senior bankers to use the EWRF expertise they learned during the event and spread it around the sector to ensure a seamless deployment.
Farmers can borrow money from banks through the EWRF by putting their produce and agricultural commodities on the market. Farmers might avoid selling their produce at disadvantageous prices merely to meet cash flow requirements for the next crop by doing so.
It will also assist Pakistan in lowering its significant post-harvest losses. The adoption of EWRF by banks, as well as its increased acceptance, will enable banks achieve higher levels of agriculture loan disbursement while also increasing credit outreach.
To read our blog on “Sindh Govt’s E-card system is causing a delay in the distribution of subsidies to farmers,” click here.
