In 2020, Ziraat Bank offered credit facilities to greenhouse growers under certain conditions. These loans aim to cover the needs of greenhouse farming, help meet the expenses and costs of protected cultivation, and support efforts to increase greenhouse production. The government also provides incentives to encourage greenhouse agriculture.
Ziraat Bank Greenhouse Loan
Under the “Support Package for Greenhouse Farming,” Ziraat Bank provides loans designed to stabilize domestic fruit and vegetable prices and meet the cash needs of current and prospective greenhouse farmers. The bank finances up to 75% of the investment cost for greenhouse projects. Loans under this package have a maximum term of seven years and are offered to qualified farmers who meet the required criteria. With low interest rates, these loans aim to increase activities in the protected agriculture sector, modernize existing greenhouses, and restore idle greenhouses back to production.
What Are the Conditions for the Ziraat Bank Greenhouse Loan?
The conditions for the Ziraat Bank greenhouse loan are as follows:
- The applicant must operate under controlled protected cultivation (greenhouse) conditions.
- The total greenhouse area must be at least 1 decare (0.1 hectare). If the farmer operates greenhouses in different locations, the combined area is counted.
- The applicant must be registered in the Provincial/District Directorate of Agriculture and Forestry’s Protected Cultivation Registration System, and the proposed projects must be approved by the directorate.
- Projects for newly established greenhouses must be completed, and the producer must register the project in the ministry system.
- The bank will conduct an inspection and the greenhouse must meet the required agricultural criteria.
If these conditions are met, applicants can apply for the greenhouse loan. Required documents must be submitted completely and typically include:
- Original and copy of the identity card,
- Residence certificate,
- Title deed for the land or lease contract if the land is rented,
- Protected Cultivation Registration System document,
- Documents related to collateral for the proposed production; the bank may request a guarantor if deemed necessary.
Greenhouse Loan Features
The key features of the greenhouse loan for those engaged in protected cultivation are:
- The maximum loan term is seven years.
- There is a two-year grace period for repayments, meaning borrowers do not start repayments for the first two years.
- The annual interest rate is set at 8.25% (monthly rate approximately 0.68%).
- The bank can finance up to 75% of eligible investment costs.
- Short-term loans of one year carry an 8% rate; loans between one and four years carry a 10% rate; loans longer than four years carry an 11% rate. With ministry support, the applicable interest rate is reduced to 8.25%.
- Although the loan includes a two-year grace period, farmers may choose to repay earlier. If they use the two-year deferral, the effective remaining repayment period is reduced from seven years to five years.
- Repayments can be scheduled monthly, quarterly, semiannually, or annually.
Loans must be used exclusively for greenhouse activities. Misuse of funds will trigger legal action.