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Rosaiah urges banks to speed up crop loans

Special Correspondent


Banks urged to meet Rs. 9,300 cr. target for rabi towards crop loan disbursal by end of Nov.

Chief Minister seeks “consumption loans” to affected farmers as per RBI norms


HYDERABAD: Chief Minister K. Rosaiah wanted banks to expedite on a war-footing the conversion of crop loans into term loans and sanctioning of fresh loans in the drought and flood-hit areas in the State.

Addressing 168th meeting of State-Level Bankers’ Committee with special focus on relief measures in drought and flood-affected regions, he urged banks to follow in letter and spirit the guidelines issued by Reserve Bank of India with regard to relief measures.

The feedback received so far indicated that conversion of crop loans in drought-affected villages was “very tardy”. Unless the first step of conversion took place, sanction of new crop loans would not happen. Similar action was required in respect of flood-affected mandals.

Collateral security

The Chief Minister also asked the banks to ensure that farmers were not deprived of any relief on the plea that collateral security was not available, particularly for loan conversions. He also called upon them to provide “consumption loans” to the affected farmers as per RBI guidelines since they were badly in need of the facility in this hour of distress.

He urged the banks to meet the target of Rs. 9,300 crore for rabi towards crop loan disbursal by the end of November.

Moratorium

Referring to SLBCs’s approval of package of assistance for SHGs in flood-hit areas, he wanted the banks to provide a one year moratorium on repayment of the existing loan, fresh loans to take up economic activities up to a maximum of Rs. 5 lakh and make the package applicable to both rural and urban areas.

Agriculture Minister N. Raghuveera Reddy urged banks to bestow special attention and display magnanimity in lending during rabi as 40 per cent fall was expected in the output due to drought and floods. He also wanted banks not to deny payment of insurance compensation on the ground that crop-cutting was done.

Rural Development Minister Vatti Vasanth Kumar requested banks to relax the six-month norm in providing loans to newly-formed SHGs.

He wanted them to step up loans to SHGs as only Rs.1770 crore was provided till now, while the target for the financial year was Rs.9,000 crore.

Andhra Bank CMD R.S.Reddy assured that banks would stand by the needy and extend the required assistance.

Referring to lending under agriculture sector, he said banks have lent crop loans of Rs.13,042 crore against target of Rs.14,000 crore, set for the season.

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