Government orders waiving crop loans at one go

Government orders waiving crop loans at one go

Crop loans that farmers have borrowed from commercial banks will be waived in one go, the state government has said in an order.

This includes restructured loans (Rs 2,812 crore), overdue loans (Rs 3,057 crore) and incentive for regular loans (Rs 720 crore) in nationalised banks.

In order, the Revenue Department has said that payments, subtracting the money already paid, will be credited to the bank accounts of
eligible farmers in a single instalment.

The crop loan waiver is Chief Minister H D Kumaraswamy’s pet scheme, his poll promise that has been implemented “after mounting much pressure on officials,” in his own words. Originally, the waiver was to be implemented over a four-year period.

So far, the government has paid Rs 3,930 crore toward 7.49 lakh crop loan accounts in commercial banks. In cooperative banks, the state government has paid Rs 4,830 crore for 11.20 lakh accounts.

The crop loan waiver scheme involves crediting Rs 25,000 into the accounts of farmers who have a regular loan, and crediting up to
Rs 2 lakh in the accounts of those who have restructured loans.

The government, however, is yet to take a stand on what it will do with crop loans that have become non-performing assets (NPA). There are 1.08 lakh NPA loans worth Rs 965 crore.

The quantum of the crop loan waiver has reduced from Rs 46,753 crore to about Rs 20,000 crore - commercial and cooperative banks put together - due to various eligibility conditions drawn up by the government.

CM to meet bankers

Kumaraswamy has convened a meeting of the State-Level Bankers’ Committee (SLBC) on June 14 to clear bottlenecks in the crop loan waiver scheme, especially with respect to 13,988 accounts that have been erroneously categorised.

Apparently, these accounts were wrongly listed as regular loans, whereas they were restructured loans. As a result, the amount that was credited to these accounts were reversed.

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