AIBB Agriculture & Microfinance 2026 WRITTEN Question Bank, Complete Solution & PDF

Case study-2 : Flood affected potato loan recovery.

Background : Rupali Bank disbursed Tk, 4.8 million in short term crop loans at 14% interest rate to 360 potato farmers in Nilphamari for winter cultivation. The loan was given for a period of 06 months on condition that the loan will be repaid after harvesting crop.

Problem :

-Sudden overflows of Testa River flooded almost 40% of potato fields.
-Only 50% of farmers made full repayment by due date.
-Some farmers demanded interest waiver due to "natural disaster".
-Middleman offered low farmgate prices, reducing farmers income.

Recovery actions taken ;

-Bank conducted field assessment and categorized farmers into fully and partially affected.
-Loan for 45% of affected farmers were rescheduled with a 3-month grace period.
-Price negotiation meetings arranged between farmers and traders.
-A mobile recovery team was formed to follow up weekly.

Outcome :

-Within four months, Tk. 3-6 million was recovered
-Farmers appreciated flexible restructuring and continued borrowing next season.

Task to do :

(a) Identify internal and external factors affecting loan recovery.
(b) Evaluate effectiveness of bank actions.
(c) Suggest additional strategies to improve recovery:
(d) Calculate recovery rate and amount of outstanding loan including interest.

Case study-1 : Mango value chain financing.

Background : A commercial bank financed mango garden owners in Rajshahi and linked them-with a processing company producing juice and dried mango. The bank' diburse loans for fertilizer, insecticides and irrigation for 350.gardens-nót less than 100 decimals in size. The principals along with interest will be collected just after the harvesting mango from gardens.

Financing structure :

-Loan size Tk. 60,000 per garden
-Tenure'l season (07 months)
-Interest rate 11% per annum
-processor paid farmers after procurement and repaid loans directly

Challenges :

-Cyclone damaged 15% of mango trees.
-Local wholesalers offered immediate cash, pushing farmers toward side-selling.
-Price fluctuation discouraged commitment to the processor.

Outcome :

-Recovery rate 80%
-Bank introduced crop insurance for next season.
-Processor planned to expand capacity

Task to do :

(a) Explain how weather risk affects credit risk.
(b) Identify incentives needed to ensure loyalty to the value chain.
(c) Discuss the role of crop insurance.
(d) Calculate total disbursed amount and interest revenue.
(e) Propose a more resilient contact farming model.

A farmer receives Tk. 2,00,000 as crop loạn at 10% annual interest. Calculate total interest and repayment amount after one year. Please keep in mind that the loan amount become complex in every three month.