Finance Minister Nirmala Sitharaman on Tuesday asked senior finance ministry officials to find out in a month’s time the reasons for lower farm share in loan sanctions by cooperative banks despite them having a larger share in Kisan Credit Card (KCC) accounts compared with scheduled commercial banks.

She was referring to an official presentation which showed that out of 73 million active KCC accounts currently, commercial banks accounted for 37% whereas their share in farm loan sanctions was 58% out of the total Rs 8.47 trillion. On the other hand, cooperative banks, which had larger share with in KCCs (46%), had only 22% share in loan sanctions.

“Sanction amount vary very significantly. It is a very interesting correlation, or absence of correlation,” Sitharaman said speaking at an event to unveil KCC Ghar Ghar Abhiyaan, Kisan Rin Portal and WINDS manual. “I ask financial services secretary Vivek Joshi to understand what causes this differences between SCBs loan sanctioning and cooperatives,” she said. “I want this analyzed within a month…if there is a way we can improve that (for cooperatives).”

An official said the difference could be partly due to the fact that ticket size of farm loans offered by cooperative banks are smaller compared with commercial banks.

The minister also appreciated real time estimation for rice and wheat crop output and called for the estimation to be extended to Dalhan and Tilhan crops so that better planning can be done for their imports, if needed. “The real time estimation of crops will help the economy and ensure right prices for farmers at the end of crop season,” she said.

Sitharaman also called for full automation of regional rural banks and cooperative banks.

The Kisan Rin portal, developed in collaboration with department of financial services, will boost access to credit services under the KCC scheme and assist farmers to avail subsidised agriculture credit through modified interest subvention scheme.

For bringing in efficiency in agricultural credit disbursement, the digital platform would provide data on farmers, loan disbursement, interest subvention claims, and scheme utilisation progress, fostering seamless integration with banks for more focused and efficient agriculture credit.

The Ghar-Ghar KCC Abhiyaan campaign aims to expand the benefits of KCC to those farmers who receive financial assistance under Pradhan Mantri Kisan Samman Nidhi (PM-Kisan) but are not enrolled in the KCC programme.

The government had launched the interest subvention scheme in 2006-07 for providing short term agricultural loans upto Rs 3 lakh at an annual interest rate of 7% for farmers who hold KCC engaged in agriculture and allied sectors activities including dairying, beekeeping etc. Additional 3% subvention is also provided for prompt and timely repayment of loans.

However, the scheme, under which Rs 23,000 crore has been budgeted in current fiscal, was modified last year where public sector banks, regional rural banks and cooperatives banks are provided with 1.5% interest subvention during 2022-23 to 2024-25

The manual for the weather information network and data system (WINDS), under the revamped PMFBY was also launched.