- March 31, 2017
- Posted by: Marvin Garcia
Agrobank Malaysia won the 2016 Global Sustainable Finance Awards (GSFA) as the outstanding sustainable project financing program for its ‘Paddy-i’ entry. The award was presented by ADFIAP and its partners, the European Organization for Sustainable Development (EOSD) and the City of Karlsruhe at the awarding ceremony held on July 14, 2016 at the German Chamber of Commerce building in Karlsruhe, Germany. The GSFA coincided with the 6th Annual Global Sustainable Finance Conference (GSFC 6) that was also held on July 14-15, 2016 in the German sustainable city of Karlsruhe.
‘Paddy-i’ is an Islamic financing scheme for the plantation and replantation of paddies in Malaysia which is deemed as a risky financing project by other financial service providers. It enables farmers to obtain financing up to RM2,500 per hectare or a maximum of RM 50,000 on aggregated basis. The purpose of the financing is to meet the working capital requirement of the farmers for the purchase of paddy seeds, fertilizers, land preparation and other production costs associated with paddy farming. Since its introduction, ‘Paddy-i’ remains as the only financing scheme offered in Malaysia.
This scheme was first introduced during the Bank’s formation in 1969 and has been instrumental in the development of commercialized and progressive paddy plantation industry in Malaysia. Over the years, ‘Paddy-i’ has become the foremost financing facility for paddy plantation and regarded as financial aid for paddy farmers that in turn reflects Agrobank’s commitment in promoting financial inclusion for the unserved and underserved segments. It has partly contributed to the Government efforts to sustain one of the oldest agriculture activities in Malaysia.
The outstanding sustainable project financing category which Agrobank won the award recognizes the outstanding success in long-term financing of exemplary industrial/commercial or infrastructure projects that benefit local communities, protect the environment and ensure reliable returns to investors and depositors.
The GSFA was launched in 2012 and presented by the Global Sustainable Finance Network (GSFN) to: (a) provide recognition to financial institutions that have successfully embedded economic, social and environmental sustainability into their businesses (b) honor organizations that have made outstanding contributions in the field of sustainable finance (c) stimulate the interests of financial institutions and other stakeholders in integrating sustainability in their core business strategy and (d) promote the growth of green financial instruments and markets worldwide.
For more information on the GSFA and the Global Sustainable Finance Conference, please visit its website at www.eosd.org.