Finance Minister Eatala Rajender faulted the attitude of bankers in collecting 4% interest from farmers on the repayment of loan as part of renewal of crop loan, for some delay in the release of funds by the State government to provide for the necessary interest subsidy.
“How can the bankers be so commercial when they are aware of the fact that the small amount due is from a State government and not from a private firm. How can they forget the benefit extended by the State government in the form of recovering nearly ₹1,200 crore outstanding crop loan declared as non-performing assets (NPAs) as part of implementing the loan waiver scheme,” Mr. Rajender said at the State-Level Bankers’ Committee (SLBC) meeting here on Friday.
Mr. Rajender’s sharp reaction came after one of the bankers pointed out that they were collecting the interest since the State government had not released necessary funds. “Had the State government not implemented the loan waiver scheme, the amount would have remained as NPAs,” he told the bankers.
After getting it confirmed with the bankers that the average NPAs in crop loan was of 7%, he said of ₹16,105 crore released as part of loan waiver, the amount would be over ₹1,127 crore.
Echoing similar views, Agriculture Minister Pocharam Srinivas Reddy said the bankers were forcing the farmers to go only for crop loan renewals by repaying the amount taken for the recently-concluded rabi cultivation even as they had time up to one year for repayment. The bankers should instead issue fresh crop loans as per the scale of finance.
He requested the bankers to repay the interest collected from the farmers since the government had released ₹271.28 crore for the purpose on Friday. Mr. Reddy also brought to the notice of the bankers that the input subsidy, ₹751 crore, released in two instalments, was not credited to the farmers’ accounts at some places till date. On behalf of the bankers, SLBC convenor U.N.N. Maiya said “big money” was blocked as NPAs due to non-repayment of loans taken for Rajiv Gruhakalpa from State Bank of India, Central Bank of India, Canara Bank and a few other banks.
He urged the State government to release ₹45 crore due to banks following re-schedulement of crop loan in Medak, Adilabad and Ranga Reddy districts after they were declared drought-hit.
