Rural development agency Nabard is to roll out a new concept called Joint Liability Group (JLG) to provide institutional credit to small farmers like share croppers, oral lessees and agricultural labourers.
Conceived on the pattern of Self Help Groups (SHG), Nabard will provide refinance facility to banks for providing lending to small and marginal farmers who are normally deprived of finance.
"We are focusing on a new concept called Joint Liability Group on the concept of SHGs. Under this, credit needs of small and marginal farmers like share croppers, oral lessees will be taken care of. A concept note in this regard has been prepared and issued to banks," Nabard CMD H K Bhanwala told reporters here today.
JLG is aimed at meeting the credit needs of share croppers and farm labourers who would form a group by joining together, he said.
"Efforts will be made to provide credit under oral lease wherein it will be ensured owner of land does not lose (land) rights and a lease is created and on the basis of that lease, farmers could be financed," said Bhanwala who is the youngest CMD of Nabard.
"Banks are ready to finance (under this scheme) and it is up to the state governments to see the opportunity," he said.
He said JLG scheme will be highly beneficial for states like Punjab and Haryana where average land holdings are shrinking and strength of such farmers is large in these states.
"Both Punjab and Haryana states are positive about JLG and it is up to the state governments to respond," he said.
Nabard has already 41 lakh SHGs which are credit linked.
Asked about new warehouse creation for farm commodities, Bhanwala said that it has already sanctioned Rs 2,200 crore of funds for setting up infrastructure for storage of agricultural items.
"Another projects worth Rs 1,300 crore are likely to be sanctioned on March 4 and by end of March, we are likely to achieve our target of Rs 5,000 crore," said Bhanwala.
Finance Ministry had allocated Rs 5,000 crore to Nabard in budget 2013-14 for supporting creation of godowns and warehouses.
