‘Else the farmers will use the money for domestic needs’
Although banks in Chitradurga district have achieved 143 per cent of their target in disbursing crop loans in the last financial year, the money was utilised by farmers for other purposes, as it was not released at the right time, zilla panchayat Chief Executive Officer N. Jayaram has said.
Presiding over the district-level bankers’ review committee meeting here on Wednesday, he said banks should release the crop loans during March and April so that they could be used for farming activities. Else, farmers used the money for domestic purposes, making it difficult for banks to recover the loan amount.
Expressing dissatisfaction that just 18 per cent of the target had been met in disbursing loans for allied activities in 2011-12, Mr. Jayaram appealed to officials of the Reserve Bank of India (RBI) and the lead banks to initiate action against those banks that did not disburse enough loans for allied activities in the district.
He also pointed out that some banks were demanding deposits from labourers for opening savings accounts. But, as per RBI guidelines, banks should not demand this amount, as payment under the Mahatma Gandhi National Rural Employment Guarantee Act was directly deposited to the bank accounts. He urged bank authorities to work with the Education Department in creating awareness about education loans.
As ultra-small branches played a “crucial” role in taking banking services to the grassroots, banks should open more of them, he added.