Their card to miseries

KISAN CREDIT CARD/ A REALITY CHECK PART - 1

Over 66 million Kisan Credit cards have been issued by banks ever since the scheme was launched by the government in 1999-2000 to provide credit to small and marginal farmers.

The Union Agriculture Ministry reckons over Rs 10,000 crore has been disbursed through the Kisan Credit Cards in the last seven years. But has it changed the fortunes in any way of the small farmers? Has their indebtedness come down? Business Standard reporters travelled to villages in Chhattisgarh and Orissa to find out.

Jagatram Gada of Narra village in the Mahasamund district of Chhattisgarh has never been to a bank or knows what it means. But he owes a debt of Rs 100,000 on his Kisan Credit Card. Of course, the debt is way beyond what Gada can pay. But the irony is, Gada never obtained the card.

Like Gada, who is in his late fifties, about 13 other farmers owe huge debts to a nationalised bank located in the Baghbahra block headquarters, about 75 km from here. Having a population of about 1,500, the village has only 13 farmers enrolled as beneficiaries of the KCC, which they have never received.

The government had devised the Kisan Credit Card scheme to give short, medium and long term credit to farmers through commercial banks, co-operative banks and regional rural banks. It is a revolving cash credit limit with any number of withdrawals and repayments allowed.

As the interest on the credit was reasonable (the State Bank of India, the country's largest bank, charges between 8 per cent and 9.5 per cent), the scheme was supposed to liberate farmers like Gada from the clutches of moneylenders. High indebtedness has been identified as the prime reason for the rising number of suicides in villages.

But the villagers of Narra have a different story to tell. The bank records show that the 13 farmers owe Rs 13.80 lakh to the bank that they withdrew over a period of last two years.

"We were stunned on receiving notice from the bank authorities for repaying the loan in December last year. It was only after that we realised we have been trapped in a big conspiracy," Vaishav Sinha, another farmer of the village, said.

The villagers later lodged a complaint with the Baghbahra police station. The then Station House Officer of the Baghbahra police station, Shohaib Khan (who was recently transferred), said a preliminary investigation suggested that a middleman named Abhimanyu Sinha dodged the farmers by taking signatures on KCC forms on the pretext of providing them loans for fisheries, poultry and other heads.

The farmers were assured loans of Rs 10,000 to Rs 25,000 by Sinha. But they never got the amount. What they did get was a huge debt ranging between Rs 1 lakh and Rs 1.25 lakh accounted in their credit.

"The police are investigating the matter before filing a First Information Report (FIR) against the middleman and the bank officials involved in deceiving the farmers," Khan said.

Interestingly, a couple of "KCC beneficiaries" even do not have a single acre of land. But in records, they own 10 acres. The photographs in the card and documents also differ in many cases.