Agriculture in India contributes more than 16 per cent of GDP and provides employment at about 42.3 per cent of the country’s employees. However, there is a big challenge before the agriculture sector – the difficulties in getting loans to the farmers. According to reports, 86 percent of Indian farmers with 2 hectares are small and somewhat. It is very difficult for these farmers to get loans from banks, and they depend on informal credit resources with high interest rates.
The main issues of the agricultural debt
Conjugate deformity: Most farmers have small or fragmented lands that are not eligible for traditional loans.
Problems Problems: The bank’s credit process contains long and complex documents and verification processes, which is difficult to take advantage of farmers.
Difference of interest rate: Instead of cheap loans from banks, farmers take loans from informal credit providers at an expensive interest rate, which increases their economic burden.
Lack of financial education: Many farmers are unaware of government credit schemes, and they have difficulty in achieving these projects.
Strong solution for agricultural loan
Warehouse Receipt Fund: Farmers can obtain loans without land -based affiliation based on their saved agricultural goods.
Price Series Fund: Farmers may help to get loans through financial services associated with agricultural distribution chains.
The use of technology: With digital sites, AI and data analysis, farmers can get easy credit receipts. These technical measures will facilitate the loan application for farmers and the approval process.
Read: Before sowing paddy, farmers must do this work in their fields and make millions of profits
Farmers Producer Organization (FPO): Group loans and joint responsibility samples can be encouraged to small farmers, which will facilitate their debt.
Government effort
The Government of India has launched many projects to increase agricultural loans. The Kisan Credit Card (KCC) and E-NWR-based Pledge Fund (CGS-NPF) will provide easy loans to small farmers. Also, many projects improve female farmers.
Increasing debt in agriculture will empower the farmers and improve their economic stability. If we all work together, a financial environmental system will become a financial environment, which leads Indian farmers to permanent agricultural development and prosperity.
(Tagstotranslate) Credit Challenges (T) Indian Farmers (T) Agricultural Resilience (T) Credit Guarantee Scheme (T) Farmer Credit
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