The stock of loans provided by the Turkish banking sector to the agricultural sector increased by nearly 18% in the first six months of the year when compared to the end of last year, approaching nearly TL 700 billion ($20.6 billion), according to data sourced from a top regulation agency on Wednesday.
The loan stock stood at TL 689.15 billion as of the end of June compared to TL 582.05 billion at the end of 2023, the data compiled by Anadolu Agency (AA) from the Banking Regulation and Supervision Agency (BBDK) revealed.
According to the data, the credit stock increased by TL 107.1 billion during the stated period.
The report said thousands of farmers and producers have taken out loans from top lenders in the country, such as Ziraat Bank and DenizBank.
According to information obtained from Ziraat Bank, within the framework of the "Financing of the Agricultural Ecosystem" strategy, the bank provided TL 200 billion in new loans to 574,000 producers, including 42,000 new farmers, during the January-June period.
The total number of producers to whom the bank has extended agricultural loans has exceeded 1 million, and the total loan amount has surpassed TL 500 billion, bringing the annual growth rate of agricultural loans to 35%.
While the bank's share in the agricultural loans sector exceeded 70%, livestock production loans accounted for 45% of the total portfolio, making it the most utilized product. These loans were followed by crop production, agricultural mechanization, and other production areas.
Public lender Ziraat Bank offers a wide range of products to ensure the sustainability and continuity of the agricultural sector. Its services ensure finances for all kinds of operating and investment credit needs in line with the production cycle, product characteristics, and harvest/sales periods of producers' agricultural activities.
On the other hand, DenizBank also witnessed a substantial increase in agricultural loans in the first six months of the year, said the bank's official.
Engin Eskiduman, Deputy General Manager of DenizBank SME Banking, Agricultural Banking and Public Finance Group, stated in his assessment that they achieved a 160% increase in agricultural loans in the January-June period compared to the same period of the previous year, noting that this increase was influenced not only by inflation but also by the regulations implemented last year.
"As DenizBank, we currently provide financial support for more than 300 agricultural products that are produced in our country and have economic value," he said.
"Our most preferred products in the first half of 2024 were agricultural equal installment loans and producer cards. As of June 2024, we have a market share of 48.4% among private banks and (we) are the leader with TL 75 billion in loans," he added.
Eskiduman explained that the bank took its first step into agricultural banking by acquiring Tarişbank in 2003, starting with four products and nearly a thousand customers in 17 branches, highlighting the exponential growth in the agricultural domain in the subsequent period.
He also noted that they divide loans into two main groups, operating and investment loans – by considering the needs of producers and sectoral requirements.
"Our investment loans are long-term loans that producers can use to grow their businesses, make them more efficient, purchase machinery and equipment, and increase profitability," he said.
He further said they have been provided with two new loan types in recent years, which target companies producing new technologies and service-based solutions in the agricultural field and provide financial support to meet the initial needs of startups in this area.
He noted that thanks to the agricultural technologies loan, producers can purchase equipment such as sensors, tracking devices, drone applications, satellite tracking systems and related services with advantageous credit opportunities.
