Governor insists on insurance for farmers

KATHMANDU, JUNE 11: 

Central bank governor has expressed the need of risk minimising instruments such as insurance in order to attract bank financing in the agriculture sector. 

“The agro sector is full of unmitigated risks which discourages financial institutions to finance agriculture and the introduction of insurance such as livestock insurance will come in handy,” said governor Dr Yubaraj Khatiwada during a programme organised by Small Farmer Cooperatives in Rasuwa’s Dhaibung VDC. 

He also pointed out the need for financial institutions to invest the money collected from rural areas in the very places instead of taking the deposits and financing urban needs. “To ensure that rural areas do not suffer from capital shortage, NRB has directed the banks to invest in rural areas,” the governor said. 

He informed that NRB has instructed financial institutions to increase their investment in agriculture from the current three per cent to a minimum of 10 per cent. “Likewise, to promote banking in rural areas, the central bank provides financial institutions interest free loans to set up branches,” added Khatiwada. 

The governor also stressed that small farmers with small land-holdings should focus on raising livestock instead of farming, pointing out that the importance of agriculture has been recognised by the state along with donor agencies and its development has been considered a priority. 

“Cooperatives are more effective and an easier means to finance for the poor farmers instead of big banks,” pointed out president of Nepal Krishi Sahakari Kendriya Sangh and Sana Kisan Bikas Bank Khem Bahadur Pathak.