Andhra Pradesh Chief Minister Mr N. Kiran Kumar Reddy has asked banks to scale up loans for the agricultural sector.
Addressing the State Level Bankers' Committee meeting here on Saturday, Mr Reddy said there was an urgent need to augment loans to farmers.
“The scale of finance for major crops in the State is lower compared to other states. This needs to be addressed,” he said.
Banks should also encourage farmers to seek fresh loans by clearing the dues, as rescheduled loans would cause additional interest burden on them.
“The interest rates on rescheduled loans are about 13 to 14 per cent, which is very high when compared to new loans,” the Chief Minister said.
For Self Help Groups, the Government has prepared a credit plan of Rs 11,575 crore for next year and banks should gear-up to meet this target, he added.
There was a lot to be done in expanding the licensed cultivators' scheme introduced last year.
Banks should devise a strategy to scale up the programme which was being implemented for the first time, he said.
TIMELY CREDIT
Mr B. A. Prabhakar, President, SLBC of AP, and Chairman and Managing Director, Andhra Bank said there was a need for banks to extend timely credit to farmers.
Banks should take necessary steps to complete lending for the 2012 kharif season before June 30, he said.
As per SLBC data, banks have disbursed Rs 29,890 crore under crop loans at the end of December 2011 as against an annual target of Rs 30,985 crore for the year 2011-12.
Against the target of Rs 73,316 crore under annual credit plan 2011-12, banks could achieve 81.8 per cent by the same time.
“As per the indications received from banks, we are confident of surpassing the target,” Mr Prabhakar said.
On the recovery front, he said there were some concerns. “In some villages, the loanees are expecting another loan-waiver. Concerted efforts are required from Government departments to allay this thinking,” he said.