KARACHI, Nov 14: The State Bank has told all commercial banks and other financial institutions involved in farm credit that there is no restriction on the banks to provide agricultural loans to the farmers having subsistence holdings.

The SBP has said this in a letter addressed to the heads of five major commercial banks (NBP, HBL, UBL, MCB and ABL), ADBP and other banks involved in disbursement of agricultural loans.

The subsistence level holding is up to 12.5 acres in Punjab and NWFP; up to 16 acres in Sindh and up to 32 acres in Balochistan.

The letter says that the banks can provide farm credit to the farmers with subsistence holdings in all the four provinces for the purchase of new or used tractors “subject to completion of required formalities.”

The letter has advised the heads of the banks involved in farm credit to ensure that “all necessary steps are taken to encourage mechanized farming in th country by making tractor financing to the needy farmers.”