SBP calls for scaling up Zarkheze to expand agricultural credit outreach

2026-02-12 - 12:06

The State Bank of Pakistan (SBP) held the Agricultural Credit Advisory Committee (ACAC) meeting today in Karachi to review agricultural credit performance and discuss measures to strengthen inclusive and resilient agricultural finance. SBP Governor Jameel Ahmad underscored that agriculture remains critical for improving farm productivity, supporting rural livelihoods, and ensuring food security. He emphasised the need to strengthen agricultural financial intermediation to support value addition, market linkages, and sustainable growth in the sector. During FY25, due to collaborative efforts by SBP and the banking sector, a record agricultural credit disbursement of Rs. 2,577 billion was achieved, marking a 16 per cent annual increase. Building on this momentum, agricultural credit disbursements during the first half of FY26 reached Rs. 1,412 billion, while the number of borrowers rose modestly to 2.97 million. The governor urged banks to fully leverage SBP’s initiatives, including the Risk Coverage Scheme for Small Farmers and Underserved Areas and Zarkheze, SBP’s flagship digital platform for agricultural lending. The Committee reviewed progress under Zarkheze, which represents a major step towards the digital transformation of agricultural credit delivery in Pakistan. The Governor emphasised that Zarkheze must be scaled up as a core delivery channel for agricultural finance, particularly to make small-ticket lending commercially viable and to expand outreach beyond traditional high-volume regions. He urged banks to ensure the timely processing of applications, strengthen internal ownership of the scheme, and further develop the vendor ecosystem to improve farmers’ access to certified inputs and embedded advisory services. The Governor also called on banks to ensure full implementation of their Agricultural Credit Expansion Plans for FY26, and emphasised the importance of coordination with provincial governments for the digitisation of land records and partnerships with fintechs, agri-tech firms, and microfinance institutions to enhance outreach. The meeting also discussed the development of an upgraded crop loan insurance framework, CLIS+, being formulated under the ADB-funded Pakistan Insurance Transformation Program (PITP) to strengthen the agriculture sector’s resilience against calamities. The proposed scheme aims to expand crop coverage, establish an insurance consortium for improved risk sharing and farmer payouts, and introduce technology-based calamity assessment along with enhanced protection through loss-of-income support. Going forward, ADB’s Solidarity Fund will also support extending coverage to non-borrowing farmers and the development of a National Insurance Policy for Agriculture. In addition, the ACAC deliberated on scaling up Electronic Warehouse Receipt Financing (EWRF) to improve post-harvest liquidity, reduce distress sales, and strengthen agricultural market linkages. The Committee noted the need to expand accredited warehousing infrastructure and enhance bank participation in EWR-based financing. Pakistan records remittances inflow of $3.5 billion in January 2026