Banks told not to adjust insurance, relief amount against farm loans

Updated - May 16, 2024 09:28 pm IST

Published - May 16, 2024 09:27 pm IST - HUBBALLI

Mentioning about a Government Order (GO) which has asked banks not to adjust crop insurance, compensation, pension, financial assistance from social welfare against farm loans of farmers, Deputy Commissioner Divya Prabhu G.R.J. has warned that in case of violation, legal action will be taken against such banks.

In a press release issued here on Thursday, Ms. Prabhu has pointed out that there have been reports of a few banks in Kundgol and Navalgund taluks of Dharwad district adjusting the compensation amount against the loans of farmers.

“If these banks continue to violate the Government Order, the administration will be forced to take legal action against them,” she warned.

In the release, she has said that owing to the failure of monsoon last year, all the taluks in the district have been declared as drought-hit and accordingly, drought relief compensation has been released and other facilities extended to farmers.

To help farmers during kharif sowing, the required money for purchase of seeds, fertilisers and other inputs has been paid to them through direct benefit transfer.

The State-level bankers committee and the government have cautioned banks against adjusting money towards loans of farmers.

Ms. Prabhu has in the release said that without the consent of farmers, the compensation amount should not be adjusted for loans.

In case of violation, the branch manager concerned will be held responsible and legal action taken, she said.

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