Bank of Bhutan (BoB) disbursed its first loan under the Priority Sector Lending (PSL) yesterday in Thimphu.
The bank’s first client under the PSL scheme was 34-year old Ambika Devi Lamichhaney from Begana in Thimphu. She plans to start a poultry farm and harvest shitake mushrooms and availed a loan of Nu 846,000 at an interest of 8.5 percent.
Under the PSL scheme, lending to Cottage and Small Industries (CSI) sector is prioritised. The CSI sector is divided into agricultural CSI and non-agricultural CSI activities.
Loan up to Nu 10 million can be availed under the scheme at a preferential interest rate of 8 percent per annum for agricultural CSI (primary production) and 8.5 percent per annum for non-agricultural CSI and value-chain financing in agricultural CSI.
Ambika Devi Lamichhaney said it took her about three months to process the loan under the scheme. “I submitted my idea in January and since I am the first client, I think it took time. I hope this will change in future.”
At the gewog level, manpower, land, market, support from concerned departments and input materials among others are examined to study the feasibility of the business.
BoB officials said that after the documents are submitted to the bank, in accordance with the bank procedures, a review is done. “But it saves time for the bank because the agriculture officials have already studied the feasibility of the business.”
The bank has received three more proposals from Chukha, Gasa and Thimphu.
Work on any business will be strictly monitored by the bank officials and concerned stakeholders since the loans are provided without a collateral.