The Karnataka government has made a move for which cooperative sector has always been fighting. In the inaugural session of the House, the governor H R Bhardwaj announced that government has plans to give farm loan through cooperatives at the one per cent rate of interest.
Cooperative sector has been fighting for a long time for lowering of the interest rate. NAFSCOB Chairman Bijender Singh , in one of the meetings with RBI advocated strongly for taking out cooperative sector from the ambit of Income Tax.
Cooperative bank takes loan at the rate of 2 per cent from NABARD and disburses the same at 3 per cent to the cooperative sector. Though many cases of fraudulent misuse of this cheap loan have come up from time to time, yet it is a big help to the needy. Now this move by Karnataka govt outshines all past efforts.
Let us hope that other states will soon follow the suit.