ISLAMABAD - The modalities for implementation of interest-free Solar Tubewell Financing Scheme are being finalised under which the federal government would concur to cover mark-up cost on behalf of farmers.

The interest free loan scheme for small farmers (having land holding of up to 12.5 acres) for installation of 30,000 solar powered tube wells over a period of three years was announced last year. Modalities are being finalised by Ministry of National Food Security and Research and Ministry of Finance. Official sources, while listing initiatives taken by State Bank of Pakistan (SBP) for financial inclusion in agriculture financing during this year, on Sunday said that in order to simplify lending process for agriculture financing, revised loan application has been introduced in consultation with banks and implemented.

The loan application form has been categorised into LAF up to Rs1 million and LAF for above Rs1 million. Another step is introduction of credit culture amongst farmers through SBP's flagship Farmers Financial Literacy Programmes (FFLP). These programme are very helpful in spreading financial awareness amongst target groups. The one-day training module is specially designed for farmers to increase their understanding of banking services, credit, savings, insurance and documentary requirements for obtaining a loan etc.

In 2015-16, around 12 FFLPs were conducted across the country and attended by 390 ACOs and over 1700 farmers. As per practice, the trained ACOs will serve as master trainers to further spread financial awareness at grassroots level through engagement sessions with farmers.