Indian Banking Association has issued advisory guidelines requesting banks to waive off the processing, documentation, inspection, ledger folio charges and all other service charges for Kisan Credit Card and crop loans upto 3 Lakhs.
“It is learnt that some of scheduled commercial banks are collecting a nominal amount of service charges towards processing, documentation, inspection, etc. for agriculture loans. However, some of the banks are collecting service charges which are at a bit higher. This is not irrespective of whether the loan is sanctioned or not. This often acts as a deterrent for the farmers to approach the banks for loans”, says a govt release.
It also says that in India, Land Holding pattern is dominated by Small and Marginal farmers (SMF) category. Roughly 85 per cent of the total operational holding in the country are in the SMF category.
There are around 21.6 crore small and marginal farmers (or 4.3 crore families). Providing timely and affordable credit to this resource constrained group is the key to attaining inclusive growth.
The small and Marginal farmers are the most affected during times of floods, droughts, and other natural calamities. The Kisan Credit Card Scheme aims at providing adequate and timely credit support from the banking system.