Agricultural credit plays a vital role in economic development with positive GDP growth of a country. These types of finance may promote to development in agro-economic sector like agriculture, poultry, fishery, dairy, and livestock. The roles of agricultural finance are described below:
1. Agriculture finance assumes vital and significant importance in the agro-socio-
economic development at macro and micro level as
well as GDP growth.
2.
It plays a catalytic role in strengthening the agro-business and augmenting the
productivity of
scarce resources.
3.
Use of new technological inputs purchased through agro-finance helps to
increase its productivity.
4.
Agricultural finance can also reduce the regional economic imbalances
and is
equals to reduce the inter-agro asset and wealth variations.
5.
It is like a lever with both forward and backward linkages to the economic
development at micro and macro level.
6.
As agriculture is
still traditional and subsistence in nature, agricultural finance is needed to create the supporting infrastructure for
adoption of new technology.
7. It promotes
to
carry out irrigation projects, rural electrification, installation of
fertilizer and pesticide plants, execution of agro-promotional and poverty
alleviation programs
in
the country.