Banks play ‘safe’ on farmer loans

From The Telegraph

Oct. 15: Janglun Tuboi, a Kuki farmer from Manja Twinomphai, applied for a Kisan Credit Card in February.

Eight months have elapsed and Tuboi is still doing the rounds of the bank with no sign of his short-term loan being sanctioned.

The farmer now plans to take a loan of Rs 5,000 from a local self-help group on a monthly interest rate of three per cent.

“I think getting a Kisan Credit Card is not an easy task for those who do not boast of a strong financial background. They (the bank authority) are not interested in issuing a Kisan Credit Card in my name as I am poor,” Tuboi said.

If Tuboi is to be believed, most banks in Karbi Anglong provide loans only to those who have accounts with them.

“Generally, banks prefer to give credit cards only to salaried persons to avoid the hassle of debt recovery.”

The irony is that the majority of banks refuse Kisan Credit Cards to the very people for whom these are meant: farmers.

A source in the National Bank for Agriculture and Rural Development said banks in Karbi Anglong were far short of the target for disbursal of the Kisan Credit Cards.

The few credit cards that are issued by banks are done so in violation of the guidelines stipulated by the government, the source added.

The annual target for Kisan Credit Cards is 7,320, but only 3,158 and 3,350 cards were issued during 2005-06 and 2006-07 .

As many as seven banks, including the Langpi Dihangi Rural Bank and Assam Cooperative Apex Bank, have branches in Karbi Anglong. Langpi Dihangi Rural Bank has 34 branches, followed by State Bank of India, which has 11 branches in the district.

Central Bank of India, Uco Bank and Apex Bank have two branches each. United Bank of India and Union Bank of India have a solitary branch each.

“The performance of Langpi Dihangi Rural Bank is relatively satisfactory. It issued more than 2,000 credit cards during the last fiscal. The Tumpreng branch of Union Bank and the Diphu branch of Central Bank of India are at the bottom of the list with two and three credit cards issued during that period,” the Nabard source said.

Officials of the district administration and Nabard met last week in Diphu and decided to crack the whip on banks that have been reluctant to issue Kisan Credit Cards.

“We plan to compel the banks to fulfil their targets,” one of the officials said.

“Banks can increase the number of Kisan Credit Card accounts, but the entire system needs to be monitored to ensure that farmers reap the benefits.”