scorecardresearch
Follow Us:
Thursday, May 26, 2022

Panel: Private banks lag in crop loan disbursals in Maharashtra

🔴 The achievement under the annual credit plan and crops loans in Maharashtra has fallen below the target set by the State Level Bankers’ Committee

Written by George Mathew , Sunny Verma | Mumbai, New Delhi |
January 29, 2022 3:35:00 am
Private banks, Private sector banks, crop loans, crop loans, disbursements, State Level Bankers’ Committee (SLBC), Maharashtra, Business news, Indian express business news, Indian express, Indian express news, Current AffairsAs against the ACP target of Rs 461,080 crore under the priority sector, the achievement is 38 per cent for the second quarter, SLBC Maharashtra said. (File)

Private sector banks are lagging behind their state-owned peers in crop loan disbursements in Maharashtra with banks even charging high interest rates and bad loans under Self Help Groups (SHGs) remaining at a high level.

At the recent meeting of the State Level Bankers’ Committee (SLBC) for Maharashtra, the RBI representative observed that the performance of private sector banks under crop loan disbursement at 35 per cent, is significantly less and need considerable attention by state heads of these banks. The case of ICICI Bank charging “exorbitant” interest rates in the case of government-backed credit schemes was also highlighted at the SLBC meeting. Government sponsored schemes include Emergency Credit Line Guarantee Scheme (ECLGS), Prime Minister’s Employment Generation Programme (PMEGP) loans, PM Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi) loans.

The achievement under the annual credit plan (ACP) and crops loans in Maharashtra has fallen below the target set by the SLBC. The committee, with Bank of Maharashtra as the lead bank, asked banks like Punjab & Sind Bank, Canara Bank, PNB, HDFC Bank and Axis Bank to gear up for improving their performance under crop loan disbursement.

As against the ACP target of Rs 461,080 crore under the priority sector, the achievement is 38 per cent for the second quarter, SLBC Maharashtra said. Further, as per the three-year comparative performance under crop loan disbursement as of October 31, 2021 presented to the SLBC, member banks were informed that achievement is 57 per cent of the total FY target. “Member banks were urged to make all out efforts to achieve the set goals during the remaining period of the financial year,” says the minutes of the last SLBC meeting held on November 26.

Best of Express Premium

UPSC Key – May 26, 2022: Why and What to know about Hawala Transaction to...Premium
BJP big guns to lend Himachal CM Jai Ram Thakur a hand as corruption, fac...Premium
Explained: The message behind Margaret Atwood’s ‘unburnable&#...Premium
Welcome to the elusive world of crypto mining: Rohtak rig, 3 engineers, R...Premium

According to SLBC minutes, the meeting was informed on the issue of “exorbitant” rate of interest (ROI) charged by ICICI Bank on the proposals of government-sponsored schemes (GSS). “The Convenor SLBC Maharashtra appealed ICICI Bank to redress the issue. ICICI Bank to relook into the matter to reduce ROI applicable on GSS,” it said.

“Representative of ICIC Bank informed house that at present two per cent ROI is reduced by bank on GSS and assured once again to relook into the issue,” SLBC minutes said.

Indicating that private banks are lagging behind, the SLBC said, “private sector banks should focus on achievement of targets under the priority sector lending.” It asked member banks to make further efforts to achieve or surpass the set target under ACP 2021-22.

Although crop loan disbursement achievement as of September 30, 2021 is more as compared to last year, absolute growth is less, according to SLBC minutes. “Crop loan disbursement reported by Beed and Buldhana districts during Rabi season is zero. Compared to DCCBs, the contribution of PSBs and private sector banks under crop loan disbursement is not up to the mark,” SLBC minutes said.

According to the minutes, the RBI representative observed that the performance of private sector banks under crop loan disbursement at 35 per cent, is significantly less and need considerable attention by state heads of these banks. He felt the need for concerted efforts of member banks in Wardha district, wherein crop loan disbursement is very poor at 47 per cent.

At the SLBC meeting, RBI Regional Director observed that non-performing assets (NPAs) under SHGs are on the higher side in the State as compared to pan India and opined for formation of special committee to study the issue of high rise in NPAs in SHG sector. Further, he said that handholding of SHGs should be done for creation of awareness among SHG members to improve recovery in SHGs.

According to SLBC, 16,000 SHG loan applications are pending at various bank branches in the state with Bank of Maharashtra and SBI having high pendency.

SLBC said some banks like Bank of Baroda are demanding additional documents over and above as prescribed by Reserve Bank of India for opening of SB accounts.

Owing to non-submission of Dr. Punjabrao Deshmukh Interest Subvention claims by bank branches to respective Asst. Registrar and DDR offices, farmers are deprived of interest incentive benefit, the committee said in the minutes. It advised member banks to submit interest subvention claims pertaining to crop loans on regular basis and ensure that no farmer beneficiary is left out on want of non-submission of claims by banks.

A Nabard official observed that the gap between the number of farmers covered under PM Kisan and the present level of KCCs may be reduced by concerted efforts by bankers in coordination with district – level Agriculture Department of the State Government by identifying the eligible farmers. “This could help in providing an additional 15-20 lakh farmers in the state with Kisan Credit Cards,” SLBC said.

For all the latest Business News, download Indian Express App.

  • Newsguard
  • The Indian Express website has been rated GREEN for its credibility and trustworthiness by Newsguard, a global service that rates news sources for their journalistic standards.
  • Newsguard
Advertisement
Advertisement
Advertisement
Advertisement