The Presidents, Commercial Banks

Chief Executives,

(14 Domestic Private Commercial Banks)

Dear Sir,

Standardization and Simplification of Agricultural Credit Documents

On the recommendations of the Committee for Standardization / Simplification of Agricultural Credit Documents, constituted under the Chairmanship of Muslim Commercial Bank Limited and Habib Bank Ltd., as its Secretary along with all heads of Agricultural Credit Departments / Divisions of National Bank of Pakistan, United Bank Ltd., Allied Bank of Pakistan Ltd., Zarai Taraqiati Bank Ltd. (former ADBP), Bank Al-Habib Ltd., Askari Commercial Bank Ltd., Bank of Khyber Ltd., Bank of Punjab Ltd., as members and State Bank of Pakistan as Coordinator, the following revised / standardized / simplified documents have been accepted unanimously for financing of different categories of agricultural loans.

1. The Revised IB-7 (appended as Annexure-A) was approved as a common and uniform charge form, which covers all legal aspects of the financing and applicable for Demand Finance, Running Finance and Revolving Credit (repayable for a period of three years in full with mark-up each year), to be implemented / adopted by all Commercial Banks and Domestic Private Banks immediately.
2. The Revised Loan Application Form (in Urdu, containing Borrowers Basic Facts Sheet) was also accepted as a common and uniform Application Form (appended as Annexure-B) to be implemented / adopted by all Commercial Banks and Domestic Private Banks immediately.
3. The Committee agreed to use the list of common documents (appended as Annexure-C) in uniformity, in addition to the Revised IB-7 and the Revised Loan Application Form.

In order to maintain the uniformity and to facilitate the farming community, all major Commercial Banks (ABL, HBL, MCB, NBP & UBL) and Domestic Private Commercial Banks are advised to adopt / use / introduce the enclosed Standardized / Simplified / Revised Agricultural Credit Documents for Agricultural loaning purposes, as developed in consensus with all Commercial Banks, under their respective Bank’s name and Monogram, with immediate effect.

Efforts have been made by the Committee and by the State Bank of Pakistan to revise the agricultural credit documents strictly in accordance with the provisions of banking laws and practices, including Prudential Regulations and without compromizing the security and interest of the banks and privileges of the farming community under the enhanced scope of agricultural credit. However, if the banks desire to ask for more information, the same may be done through the same process, i.e., should be discussed in the above Committee and after the approval of the State Bank of Pakistan.

Please acknowledge.