Co-operative banks fail to meet loan target

Mumbai: District banks are again failing to achieve their target of crop loans this year in Marathwada region, which is the epicentre of farmers’ suicides in the state. The district banks in Aurangabad, Jalna, Parbhani and Hingoli had crop loan disbursement target of Rs 4,643 crore, but only Rs 660 crore was given as loans to farmers in these districts. Local farmers body Baliraja Sanghatana has alleged that banks have failed to help the farmers.

Experts fear that due to this, farmers may again turn to private moneylenders and the vicious cycle of loans and suicides will continue. While the state government claimed that it has given instructions to banks to disburse loans as soon as possible.

As Kharif season begins, it was expected that crop loan disbursement would gain momentum in the region after the government declared the farmers’ loan waiver on June 11. However, district co-operative banks in Aurangabad, Jalana, Parbhani and Hingoli haven’t been able to meet the target of Rs 4,643.76 crore. The banks have been able to disburse loan of up to Rs 659.82 crore until June 27. Interestingly, all district banks in four districts had disbursed crop loans up to Rs 1,658.33 crore until June 27 in 2016.

Even commercial banks in these districts were given a target of Rs 3,208.29 crore. But these banks also gave crop loans up to Rs 323.97 crore. The situation is even worse when it comes to the loan disbursement of rural banks. Out of Rs 558.57 crore target set for this season, rural banks disbursed only Rs 52.14 crore loans until last week.

While the government has decided to waive off loans of farmers, banks have expressed reluctance over offering fresh loans, citing the reason of credit unworthiness of some farmers. “The government should have completed the exercise by May end so that this procedural delay could have been avoided. Even now the government can ask banks strictly to follow the orders. District co-operative banks come under the government. Now, farmers have no option but to knock on the door of private moneylender again,” said Manik Kadam, a member of Baliraja Sanghatana.

Speaking to The Asian Age, Aurangabad district co-operative bank chairman Suresh Patil said, “We have already started disbursing loans. But as there is low repayment of earlier crop loans, we too are facing difficulties.” Managing director of Parbhani district cooperative bank Vishnu Jadhao said, “Banks are facing monetary issues. We don’t have enough funds. But now we are consulting with department and trying to find the solution.”

Minister of co-operatives, Subhash Deshmukh also said, “We have already given instructions that co-operative banks should help farmers. But even if farmers are facing the problem of getting loans then they should contact district marketing department officers.”

Need intervention

Farmers had sowed their seeds by first week of June. But as rains didn’t arrive until June 20. Now, farmers need money to sow the seeds again. As rain has arrived in almost all part of the state, now farmers don’t have time to wait for clearance of banks for loans. In such condition, if banks shut their door, then farmers will be forced to take loans for private moneylenders. Loans from private moneylenders is one of the biggest reasons for the suicides of the farmers in Marathwada and Vidarbha.

Target missed

• Co-operative banks in Aurangabad district could disburse  Rs 161.32 crore loans to 61,284 farmers until June 27. Banks had given Rs 265.50 crore in the first six months of the 2016.
• Co-operative banks in Jalana district could grant only Rs 43 crore as loans, whereas last year the banks had given Rs 97.44 crore crop loans in the same period.
• Co-operative banks in Parbani also missed the target of farm loans. Rs 51.73 crore crop loan has been disbursed until June 27, 2017. Last year, Rs 158.63 crore loans were given in the same period.
• Hingoli co-op banks also failed to achieve its target. Only Rs 27.52 crore loans disbursement were sanctioned until June 27, while last year it was Rs 62.9 crore in the same period.
• Commercial banks disbursed only Rs 323.97 crore until June 27. Last years these banks had given loans up to Rs 921.5 crore.