Farmers use services at a BAAC branch in Lop Buri province. The BAAC lent 678 billion baht in the 2018-19 financial year.

The state-controlled Bank for Agriculture and Agricultural Cooperatives (BAAC) aims to lend 770 billion baht in its 2019-20 financial year, up 95 billion from the previous year.

The bank will extend loans to its existing customers, with incremental increases earmarked for farmers who are welfare smartcard holders, general borrowers and small and medium-sized agricultural enterprises (SMAEs) worth 13 billion, 44 billion and 38 billion baht respectively, said president Apirom Sukprasert.

For the 2018-19 financial year ending March 31, 2019, the bank lent a mere 10 billion baht to SMAEs, missing its 3-billion-baht target, Mr Apirom said.

The problem was that agricultural cooperatives did not take out loans worth 15 billion baht for purchasing paddy from farmers under the government's scheme to delay the release of paddy and elevate prices.

The bank's lending policy this financial year is consistent with agricultural sector reform focusing on the use of technology and innovation to improve production output and cut costs, Mr Apirom said.

"If farmers are failing to generate income and seek loans for production, the BAAC will consider whether they change crop production methods," he said. "If they stick with existing crop and production methods, the bank will reject their loan applications."

For example, the BAAC extended loans to a group of farmers to buy 60 drones valued at 500,000 baht each for farming in the previous financial year. The bank expects to lend these farmers money to buy 100 drones this financial year.

The BAAC also plans to provide support to 400 communities nationwide to produce safe food and engage in organic farming that meets the standards of Good Agricultural Practices and Organic Thailand in accordance with the bank's Go Green strategy.

The BAAC lent 678 billion baht in the 2018-19 financial year, up 81.6 billion from the preceding year.

Loans outstanding amounted to 1.45 trillion baht at the end of the 2018-19 financial year.

Net profit inched 0.24% higher to 9.88 billion baht in the previous financial year, while non-performing loan ratio fell to 3.87% from 4.34% a year earlier.