Bumthang farmers thrive on BDFC loans
From Kuenselonline.com
16 April, 2010 - Bumthang dzongkhag received snowfall this winter, there was occasional rainfall in the past few days and farmers have successfully completed planting their main cash crop, potato.
But this would not have been successful even with the weather favouring them, if the Bhutan development corporation (BDFC) had not injected capital, in the form of group loans, according to farmers. The farmers from the four gewogs have availed a group loan of Nu 20M in the last three months.
The 380 clients used the loan to mainly purchase fertilisers, seeds and pesticides, according to BDFC branch manager, Namgay Rinchen. “Some farmers used a portion of the loan to spend on their children’s education, like buying stationery and clothes,” said the manager.
The notable Bumthap potato is highly sought at the auction yard in Phuentsholing and farmers said, without the loan, cultivating potatoes would not be as successful and fruitful when it is harvesting time.
An Ura farmer, Sonam, said that she borrowed Nu 10,000 at10 percent to buy urea and suphala. A bag of urea cost Nu 374.64 and a bag of suphala Nu 780, and Sonam spent half the loan on the fertilisers. With farmers becoming guarantors for each other, most are encouraged to borrow money and improve their investment in cash crop production.
The loan must be repaid at the end of the year from harvest sales and most farmers are comfortable with the interest rate. “If the market is good at the time of harvest, there’s no problem in repaying,” said Sonam.
Out of the Nu 20M loan disbursed, about Nu 8M was spent on urea and suphala, as the dzongkhag agriculture office has sold 2,074 bags of urea and 897 bags of suphala within past three months through the fertiliser agent.
Meanwhile, the number of farmers and amount of loan disbursed had been increasing since 2007. From 378 clients in 2007, client number has increased to 511 farmers. The loan disbursed has also increased from Nu 15M to Nu 36M.
It is a positive sign that the farmers are making good use of rural credit, said the branch manager. “We have a social mandate and farmers are recognising it,” he said.
However, farmers said that, with an uncertain market and price, sometimes they face problems when their crop is stuck in Phuentsholing without a good price and market.
By Samten Yeshi
