The Bank for Agriculture and Agricultural Cooperatives (BAAC) expects a doubling of outstanding loans to farm-related businesses to 10 billion baht during this fiscal year.
Executive vice-president Chaiwat Pokpong said the loans are extended to small mills and farm product processors and distributors.
The state-owned bank's fiscal year runs from April 1-March 31.
Mr Chaiwat said demand for loans from farm-related businesses is high, particularly from borrowers who secure loans of 5-10 million baht each.
The BAAC has set no restrictions on loan amounts for each borrower.
The biggest loan secured by a farm-related business is 200 million baht.
The loans account for less than 15% of BAAC's lending portfolio, below the legal limit of 20%.
The BAAC expects total outstanding loans for this fiscal year to reach 100 billion baht, exceeding the target of 85 billion baht.
It recorded outstanding loans of 92 billion baht in the first eight months of the fiscal year.
Mr Chaiwat said the BAAC plans to extend farmer loan cards to members of more than 2,000 agricultural cooperatives nationwide.
It plans to issue 1.5 million of the cards, adding to the 4 million now circulating.
Mr Chaiwat said half the 2,000 co-ops have financial transactions with the BAAC, which has extended them a combined 50 billion baht in loans.
The cards offered to co-op members will have new features, allowing ATM withdrawals of borrowed money and making users of cards more familiar to the BAAC.
The loan cards for farmers, a populist policy of the ruling Pheu Thai Party, offer a credit line of up to 70% of a farmer's production value and available sales.
The holder can use the card to pay for fertiliser, seeds, machinery and pesticides at participating vendors and get cash advances of up to 50,000 baht.