The major occupation of the people of Bangladesh is ‘agriculture’. Agriculture is the single largest producing sector of the economy since it comprises about 30% of the country’s GDP and employs around 60% of the total labor force. The performance of this sector has an overwhelming impact on major macroeconomic objectives like employment generation, poverty alleviation, human resources development and food security. A bank is just like the heart in the economic structure and the capital provided by bank is just like the blood in it.
The economy of Bangladesh is mainly dominated by agriculture, that is why if the finance is not provided to the agricultural sector, the growth of the economy will be slowed down. Loan facility provided by the bank works as an incentive to the producer to increase production. Keeping this in mind, for the purpose of the development of agricultural sector, the Government of Bangladesh has established two specialized banks, namely- Bangladesh Krishi Bank (BKB) and Rajshahi Krishi Unnayan Bank (RAKUB). These banks are continuously trying to provide support for the advancement and development of the agricultural sector of the country. First of all, they are promoting savings, mostly from middle and lower middle class of urban and rural people. Secondly, these banks promote investment in different sectors of agriculture, industry and trade. They either invest directly or advance loan to the investors. They are continuously helping the disadvantaged people to become self sufficient and self dependent by providing them micro credit.
Rajshahi Krishi Unnayan Bank was established by the President’s Ordinance No. 58 of 1986. It took over the operations of 253 branches of Bangladesh Krishi Bank of the then Rajshahi administrative division (presently Rajshahi and Rangpur divisions) with the aim of providing institutional agricultural credit for optimum utilization of agricultural potentials of Rajshahi Division. Taking over the branches and offices along with assets and liabilities the bank started functioning on 15 March 1987. RAKUB is the only specialized nationalized bank having its head office outside Dhaka, i.e. at Rajshahi.
As the largest development partner in the northwest region, RAKUB aims at overall development of farmers and all the sectors and sub-sectors of agriculture in this region. Besides catering to agricultural credit, the bank performs ancillary functions as financing agri-business and agro-based industries and poverty alleviation programs. Authorized capital of the bank is Tk.7500 million and paid-up capital is Tk. 5700 million only. There are 18 independent zonal offices for operational activities and 18 separate zonal audit offices for conducting regular audit in branches and zonal offices. At present (as of 30-06-2014) there are 376 branches of the bank including LPO and Dhaka branch among which 190 are in Rajshahi and 184 in Rangpur division. Number of rural branches are 307 while urban 69.
RAKUB caters to financing of all the agricultural activities including crop production, fishery, animal resource, irrigation equipment and farm machinery, crop processing and marketing, agro-industries and agri-business. The bank pays importance to financing poverty alleviation and employment generation activities, SME and other off-farm activities. RAKUB continues financing to widen and expand small and medium enterprises as well as agro-based industries, cash credit program and other project loans aiming extension of employment opportunities to reduce unemployment and poverty alleviation in line with the government’s policy of industrialization. Meanwhile, by the virtue of a strong and effective Board of Directors, especially on behalf of dynamic leadership of the chairman of the Board, Professor Dr. M Shah Nowaj Ali, credit limit for individuals and enterprises engaged in small and medium industries has been increased to Tk.100.00 million fr