The credit offtake in agriculture sector was not up to the expected mark in the first half of the current fiscal in Maharashtra. The reason behind this development is that bank officials are reportedly busy in implementing the debt waiver scheme, which was announced by the Centre early this year, and the late arrival of monsoon, which badly affected the kharif harvest. Concern was expressed over the issue during the quarterly state level bankers’ committee (SLBC) meeting, which was held in Pune on Wednesday. However, the bankers in the state are expecting that the credit offtake will pick up during the second half of the fiscal.
Talking to FE after chairing the meeting, Allen CA Pareira, chairman and managing director of Bank of Maharashtra, said, “We have realized that in the first half of the current fiscal, the revenue earned from agriculture credit was running short of 5-6% of the projected targets and fared below expectations.”
“We are hopeful that the agriculture credit will pick up in the later part of the financial year,” said Pareira.
On SME loans, the SLBC decided to hold cluster meetings for various SME groups in the state and all the banks within the state have been asked to tone up lending to the SMEs. Also, the banks have been asked to increase the level of receivables if there was any mismatch between cash flows and reschedule payment obligation wherever it was required. On ICICI Bank’s request for liberalization in the branch operation area norms, the SLBC has asked the bank to furnish details within 15 days so as to consider the liberalisation demand. As per the existing RBI norms, the distance between base branch and business correspondent should not be more than 5 km in a metropolitan area and 15 km in a semi-urban region.