Chief Minister K Rosaiah on Tuesday asked the State Level Bankers’ Committee to expedite financing to tenant farmers through joint liability groups (JLGs). Though the agriculture department provided the banks a list of 12,127 JLGs for lending, they were still awaiting sanction of loans.
Addressing the bankers at the 171 SLBC meeting, he said financing to tenant farmers had not progressed despite clarifications issued by Nabard. The same issue was raised in the earlier meeting in May to ensure that banks lent to JLGs from the current kharif season, he pointed out asking the SLBC to clarify its position and indicate a plan of action for this.
Conversion of loans to farmers affected by drought and floods last year too had not been satisfactory. Only 32 per cent of the eligible loans had been converted into term loans. The officials should redress farmer complaints immediately. He asked the officials to work out a strategy to achieve a 10 per cent annual growth in the number of micro enterprises accounts.
The credit extended to the micro, small and medium enterprises (MSME) till June 2010 was Rs 3,371 crore as against the target of Rs 8,150 crore. Within MSME, loans to micro enterprises accounted for 25.86 per cent as against the RBI norm of 50 per cent. However, the achievement in the agriculture sector was satisfactory at Rs 13,327 crore, 76 cent of Rs 17,473 crore target.
He asked the banks to focus on extending collateral-free loans up to Rs 10 lakh for micro and small enterprises, ensure adequate coverage for animal husbandry and fisheries and open ‘no frill’ accounts under financial inclusion.