Denied crop loan, farmers at mercy of moneylenders

Parvesh Sharma

Tribune News Service

Sangrur, July 19

Farmers in Sangrur and Barnala are compelled to borrow money at higher rates of interest from private moneylenders to meet their crop sowing expenses as cooperative societies in both districts have stopped releasing crop loans.

Sources said under Sangrur Central Cooperative Bank, there were a total of 296 cooperative societies, formed to help farmers by extending timely crop loans to prevent their exploitation by private moneylenders.

But officials in these societies said almost a month ago, their senior authorities had told them not to release fresh crop loans.

"On an average, a farmer spends around Rs. 20,000 per acre to sow paddy. But in the absence of crop loans from societies, which charge around 7 per cent rate of interest, we are forced to borrow money at 15-18 per cent from private moneylenders," claimed Dharminder Pashore, Lehragaga block president, BKU Ugraha.

Ramit Singhal, Chief Manager, Sangrur Central Cooperative Bank, confirmed that they were unable to release loans to farmers as the National Bank for Agriculture and Rural Development (NABARD) had not released the required money.

"We have written to our seniors to take up the matter with NABARD to resolve the issue at the earliest," he said.

NABARD refuses to advance money

Chandigarh: Punjab State Cooperative Bank, which gets re-finance from NABARD, has defaulted on the payment of loan to it. The bank got a re-finance of Rs 2,500 crore for the last crop cycle. As most of the farmers did not repay their loan hoping for a waiver, the money was not returned to NABARD. The latter thus refused to advance loan to the bank. As the system goes, NABARD gives loan to the bank, which further gives loan to 20 district cooperative banks for distribution to primary agriculture cooperative societies. tns