(MENAFN- KNN India)
New Delhi, Jan 6 (KNN) Agricultural credit growth is expected to exceed 13 percent in the current financial year, reaching Rs 27-28 trillion, according to National bank for Agriculture and Rural Development (Nabard) Chairman Shaji KV.
Speaking at a media interaction in New Delhi, he highlighted that agricultural credit has maintained a consistent average growth rate of 13 percent over the past decade, outpacing other sectors.
The sector has already demonstrated strong performance in FY24, with disbursements of Rs 25.1 trillion provisionally reported, surpassing the government's target of Rs 20 trillion by 25 percent.
This growth encompasses credit distributed through scheduled commercial banks, regional rural banks, and rural cooperative banks.
A significant shift toward formal credit channels is emerging in rural areas, with declining reliance on informal lenders. This transition is particularly beneficial for rural communities, as formal credit sources typically offer lower interest rates and better margins compared to informal lending options.
However, challenges persist, particularly in areas where limited access to land records poses barriers to proper KYC procedures.
To address these challenges, Nabard is partnering with the government's agri stack initiative, which aims to digitise agricultural data across three key layers: farm layer (land records), farmer layer (KYC), and crop layer.
The organisation is also making significant progress in digitalising primary cooperative societies, with 67,000 out of 100,000 societies scheduled for computerisation this financial year, and approximately 50,000 already digitised.
The Kisan Credit Card (KCC) scheme continues to expand its reach, now targeting not only traditional farmers but also those involved in allied activities such as animal husbandry and fisheries.
As of June 30, 2023, the scheme boasts over 74 million active accounts with outstanding credit of Rs 8.9 trillion. Nabard is collaborating with the Department of Financial Services and various financial institutions to ensure adequate credit reaches these sectors.
Rural consumption has shown promising growth, outpacing urban areas and generating significant regional demand. Nabard aims to capitalise on this trend by focusing on marginalised producers, providing them with technology support, branding assistance, and digital commerce integration to sustain and enhance this growth momentum.
(KNN Bureau)
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