Loan waiver at snail’s pace in Telangana

Incomplete or improper account details of beneficiaries resulted in non-transfer of amount

Farm loan waiver process impaired by improper or incomplete information of beneficiaries. A farmer ploughing his field prior to sowing in Khammam district.

The waiver of loans borrowed by farmers in the previous term of Telangana Rashtra Samithi (TRS) rule, an election promise of the party before it started its second innings, has met with hurdles after its implementation began a month ago.

The government had firmed up plans to waive loans in the first phase of such farmers whose borrowings did not exceed ₹ 25,000 with an outlay of ₹ 1,210 crore. But, so far only about ₹ 500 crore was deposited in the bank accounts of 3.50 lakh farmers out of a targeted 6.10 lakh farmers.

Official sources said the delay was on account of some reasons for failure of direct benefit transfer (DBT) through the National Payment Corporation of India. They included closure of accounts, no such accounts, account description not tallying, invalid account type, account blocked and invalid IFS code.

In addition, there were related reasons for delay in processing the benefits due to absence of Aadhaar numbers or improper numbers.

Data de-duplication

It was argued that the de-duplication and identification of multiple loan accounts at various banks was possible only by 100 % authentic Aadhaar numbers. The numbers should also be mapped with ePublic Distribution System (ePDS) data for identifying family members who availed crop loans since the benefit was extended to a family as unit with a cap of ₹ one lakh.

In the post-reorganisation of districts and mandals, the names of some of them were missing which led to inability in mapping the bank branches that delivered the service. There were no IFS codes given for some bank accounts which was mandatory, the date of sanction of loan was not between April 1, 2014, when the scheme became operational with the cut off date of December 11, 2018, invalid or no loan account numbers and principal amount entered as zero.

The data for waiving loans was received from 42 banks and 3,351 branches. The total number of loan accounts received from the banks was 42.56 lakh, including 39.18 lakh crop loans and 3.37 lakh gold loans. The total outlay of the scheme was fixed at ₹ 30,723 crore.

After outstanding up to ₹ 25,000 was paid in the first phase, the balance up to ₹ one lakh was to be paid in four phases in four years with a budget of ₹ 24,738 crore. The government had earmarked ₹ 6,225 crore for the scheme in this year’s budget but it has to shell down interest due to delay in implementation.