The Hindu : Tamil Nadu News : Canara Bank to underwrite Rs.1, 600 crore in farm loans

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Sunday, May 25, 2008
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Tamil Nadu

Tamil Nadu

Canara Bank to underwrite Rs.1, 600 crore in farm loans

Nodal officer appointed to supervise implementation of loan waiver scheme

Three per cent of fresh loans will be set aside for debt swap with moneylenders this year
Bank plans a technology-based total financial inclusion in 100 villages across the country

MADURAI: Canara Bank will underwrite Rs. 1,600 crore out of the Rs.18,000 crore in farm loans it has lent, under the Centre’s loan waiver scheme.

“Despite the revision of the terms of the waiver, we do not expect the figure to increase substantially, as many eligible beneficiaries have been covered,” bank Chairman and Managing Director M.B.N. Rao told reporters on Saturday after inaugurating an ATM at Narayanapuram here.

The Union Cabinet on Friday increased the waiver amount, by 20 per cent, to Rs. 71,680 crore by bringing big farmers under the scheme. In 237 dry and drought-prone districts, farmers will get a minimum one-time relief of 25 per cent of their loan dues or Rs. 20,000, whichever is higher.

Mr. Rao said a nodal officer in the rank of executive director had been appointed to supervise the implementation of the scheme, and efforts were on to identify the beneficiaries. As for the debt swap with moneylenders, he said a survey would be conducted in all villages. Three per cent of the bank’s fresh loans this year would be set aside for this sector.

He did not foresee any revision in the interest rate in the short term. “Inflation is being driven up by the high costs of commodity and oil, for which the government is undertaking many supply-side measures. We will ensure that all our growth sectors have in excess of 30 per cent funds.” Sectors that were likely to drive the growth were infrastructure, retail lending, small and medium industries and agriculture. In the past two years, farm lending doubled.

Speaking about Canara Bank’s technology initiatives, he said a technology-based total financial inclusion would be undertaken in 100 villages. Mobile voice-based ATMs, seven of which now operates nationwide, would be part of the drive.

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