Agrobank Expands Farmer Protection with the Launch of STTP in Sabah

Agrobank today launched the Paddy Crop Takaful Scheme (STTP) in Sabah, aiming to extend financial protection to paddy farmers nationwide.

Introduced in September 2024, the Shariah-compliant STTP offers coverage of up to RM3,000 for losses caused by natural disasters, and up to RM1,500 for damage due to pests and plant diseases — significantly higher than existing disaster relief schemes.

According to the Deputy Minister of Agriculture and Food Security, YB Datuk Arthur Joseph Kurup, “As of 30 April 2025, a total of 5,642 paddy farmers in Sabah have registered and are covered under STTP. However, more than 19,000 farmers have yet to register, including 6,602 individuals who still do not have an Agrobank account.”

He added that the scheme is offered at an affordable contribution rate of RM64.80 per hectare per season, which is currently borne by the Federal Government.

In this regard, he urged all unregistered farmers to register immediately so they don’t miss out on this protection. As of March 2025, a total of RM16.2 million in compensation has been approved to help ease the burden of 6,319 farmers across the country who have been affected by disasters.

“The launch of STTP in Sabah is a testament to Agrobank’s commitment to ensuring no farmer is left behind from the vital financial protection they need. We understand the challenges faced by the farming community and will continue to play our role as a provider of inclusive and comprehensive financial solutions for the agri-food sector.”

The Ministry of Agriculture and Food Security (KPKM) also welcomes the Sabah Government’s move in establishing the Sabah Paddy and Rice Board (LPBS), which will serve as a strategic partner in strengthening the management of the paddy and rice industry in Sabah. This move aligns with the Ministry’s goal to enhance national food security and strengthen the agro-food value chain.

LPBS will focus on increasing paddy yield and developing new rice fields, while STTP will serve as a financial safety net for farmers exposed to unforeseen risks. Both initiatives complement one another and are vital components in strengthening the paddy cultivation ecosystem in Sabah.

Agrobank will continue its efforts to increase awareness and understanding of STTP through collaboration with local farming agencies, while also expanding financial service access to farmers.