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Maharashtra govt to speed up loan waiver scheme as banks ‘refuse to cooperate’

The Aadhaar-authenticated process came to a standstill during the first phase of a countrywide lockdown in March. Around 18.96 lakh farmers had received waiver worth Rs 11,999.1 crore with another 11.16 lakh farmers waiting to receive their waiver.

Written by Parthasarathi Biswas | Pune | Published: July 8, 2020 2:36:49 am
uddhav thackeray, maharashtra chief secretary, maharashtra new chief secretary, maharashtra new Principal Advisor, uddhav thackerays news principal advisor, indian express news Announced by Chief Minister Uddhav Thackeray, the loan waiver scheme had aimed at waiving off pending crop loans up to Rs 2 lakh. T

Maharashtra government has decided to speed up the completion of its farm loan waiver scheme, Mahatma Jyotirao Phule Karjmukti Yojna, as banks have reportedly been uncooperative. Senior government officials said the loan waiver scheme will be completed by the end of this month, which will solve the issue of farmers’ eligibility for new crop loans.

Announced by Chief Minister Uddhav Thackeray, the loan waiver scheme had aimed at waiving off pending crop loans up to Rs 2 lakh. The Aadhaar-authenticated process came to a standstill during the first phase of a countrywide lockdown in March. Around 18.96 lakh farmers had received waiver worth Rs 11,999.1 crore with another 11.16 lakh farmers waiting to receive their waiver. A total of Rs 8,000 crore is yet to be released to complete the scheme and enable farmers to become eligible for receiving new loans.

Back in March, the state government had issued a government resolution (GR) asking banks to extend loans to farmers featured in the eligibility list of the waiver. The government was to ensure that the pending amount will be transferred to banks in due course of time. This instruction, however, does not seem to have worked with the state reporting just close to 30 per cent disbursal till the end of June. While district central cooperative banks (DCCB) have managed to disburse 68.68 per cent of their target, commercial banks have disbursed only about 15.16 per cent of their target till June 15.

Officials of the cooperative department said commercial banks were reluctant to accept the GR as Reserve Bank of India has not given the green signal. Commercial banks account for over 80 per cent of the loan disbursal, thus affecting the process of loan disbursal, they added.

“During the lockdown, the government had little or no earnings but since the easing of the lockdown has started, government coffers have seen a steady income,” said an officer.

Instead of asking banks to press for the implementation of agreements, the government has accelerated the process of clearing the pending waiver. In this regard, Rs 4,000 crore has already been transferred, while another Rs 4,000 crore is expected to be transferred in the next few weeks.

“Once banks receive the waiver amount, there would be no excuse for them to not extend fresh loans to farmers,” the officer said.

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