RBI has no figures of subsidised farm loans

In a development that can have serious ramifications for the ruling NDA less than a year ahead of 2019 general elections, the RBI has said that it has no information how many farmers have been given concessional loans as cleared by the Centre in June last year.

Prime Minister Narendra Modi-led Union Cabinet had cleared an interest subsidy scheme to help farmers get short-term crop loan up to Rs 3 lakh payable within one year at 4% per annum, reducing it drastically from the then 9% per annum interest rate.

Under the mechanism, the interest subvention was to be given to public and private sector banks, cooperative banks and regional rural banks (RRBs) on use of own funds and to the Nabard for refinancing to RRBs and cooperative banks.

On Friday, when a Parliamentary Standing Committee sought to know from the representatives of the RBI as to how many farmers were given farm loan by the scheduled commercial banks at the rate 4% per annum, the central bank’s response was that “the information was not available with them.

Under the scheme, banks were given an interest subvention of 2% per annum on the use of their own resources. An additional incentive of 3% was to be given to farmers for their timely repayment.