Agricultural Credit Bank To Offer EGP 500 Mln Islamic Finances In FY 2012/13

The Principal Bank for Development and Agricultural Credit targets to inject Islamic finances worth EGP 500 million to raise the sharia-compliant finance portfolio to EGP one billion by the end of FY 2012/2013.

Such finances will be used to finance agricultural joint ventures and micro-enterprises, sources said. The bank‘s strategy is based on financing agricultural projects and providing customers with machines and tools.

Sources revealed the negotiations conducted by the bank and the Ministry of Agriculture to allocate for the bank agriculture lands with area ranging from 5,000 feddans (5,190 acres) to 10,000 feddans (10,380 acres) to set up productive villages that will produce all agricultural products and crops in new cities.

The bank has set different scenarios. The first one is buying lands and selling them to farmers under Murabaha scheme. The second option is contracting with a company to reclaim the land and buying it from the company to be sold afterwards to farmers or entering into partnership with farmers under Musharaka scheme.