What you need to know about agricultural loans? In Myanmar, which is based on agriculture, the main role is played by the farmers. In order to develop the country’s economy, including agricultural activities, it is necessary for large farmers to receive strong investment money. Therefore, the government Banks and private organizations provide loans for agricultural businesses and provide support to farmers.
It’s a financial service that aims to support businesses that sell and wholesale. In other words, it’s a service that provides loans to grow the agricultural sector and get the investment money needed by big farmers.
Type of loan based on time period
When taking an agricultural loan, it is still classified into short-term, medium-term, and long-term loans depending on the loan period. Short-term loans that will last from 6 to 15 months according to the loan requirements; A medium-term loan that will last from 1 and a half to almost 5 years, Long-term loans that last for 5 years or more.
Things you should know before taking a loan
As a farmer, before taking an agricultural loan for your business, you need to understand that there are legitimate lending institutions and illegal lenders. When taking a loan, it is best to get it from a legitimate loan company to ensure fair interest and no negative consequences. If you take a loan from banks and official lending businesses opened by the government, whether it is a loan that requires collateral. It is still classified as a loan without collateral.
Seasonal loans (loan on agriculture land)
There are many types of loans related to agriculture. One of Roma Bank’s agricultural loans is seasonal loans (loan on agriculture land).
It is a type of loan that is given depending on the cultivation period for rice, beans, and corn. The loan period is from (8) to (10) months. Another type of loan is the type of loan where you use non-perishable agricultural products from your warehouse as collateral. The loan period is a maximum of (12) months. Another loan is a short-term loan that is given for the money owed and received in agriculture, and it only lasts up to a maximum of (6) months. Loans are made for long-term investments such as building expansion and construction. The interest rate for agricultural loans provided by Roma Bank is 10% interest per year if collateral is provided, and 14.5% interest per year if there is no collateral.
What should I prepare to get a loan? (agriculture loan)
So, in order to obtain loans from banks. The first thing farmers must do is to record their business’s income and expenses properly and prepare financial statements. Another thing is to pay taxes for the business. If you can show the bank statements and tax statements that I have just mentioned, you will be able to get the agricultural loan that you need.
To modernize the role of agriculture in the country. It is necessary for the farmers who work in agriculture to get enough investment money. In order to further develop the agricultural sector and to get enough investment money needed by entrepreneurs. It is important to be able to borrow agricultural loans. In order for farmers to get the support they need. The banks and governments are lending agricultural loans. And you should study in advance how to get the type of loan. That suits your business and how to repay it.