2022, Vol. 3, Issue 2, Part A
Agricultural finance of commercial banks in India with special reference to lending and recovery
Author(s): Dr. Prabhu Nath Singh and Sandeep Kumar Sourav
Abstract: The overdue position among all the credit institutions in the formal sector namely commercial Banks has seriously hampered the expansion of agricultural credit. The reasons for poor loan recovery were largely attributed to lack of sufficient field staff to ensure follow-up after the sanction of loan and absence of statutory powers to induce prompt repayment by the borrowers as far as the banks are concerned. In addition, the government's populist policy of waiving off loan has created mass psychology in the rural areas to withhold repayment and wait for some type of loan waiver programme to come to their rescue. More importantly, the reasons for nonpayment of the loan amount by the borrowers were, failure of monsoon, diversion of the loan amount for purposes other than agriculture, farm investment turning out to be unproductive, the income from the crop yields was not sufficient to repay the loan while maintaining their families and priority given to the repayment of loans borrowed from the private moneylenders. Some of the suggestions for prompt recovery of loans includes continuous supervision and follow up action after the loan is dispersed, realistic assessment of loan requirement and providing technical support to the farmers to increase the productivity which will ensure better repayment by the borrowers.
Pages: 37-40 | Views: 413 | Downloads: 211
Download Full Article: Click Here
How to cite this article:
Dr. Prabhu Nath Singh, Sandeep Kumar Sourav. Agricultural finance of commercial banks in India with special reference to lending and recovery. Asian J Manage Commerce 2022;3(2):37-40.