Banking on moneylenders

Banking on moneylenders
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First Published: Fri, Jul 11 2008. 07 28 PM IST
Updated: Fri, Jul 11 2008. 07 28 PM IST
The loan waiver came late for many of Vidarbha’s farmers. With the sowing season already upon them, they were forced to knock on the doors of banks, who more often than not turned away defaulters. But not before giving them a strange piece of advice—borrow from the moneylender.
So why do banks have to send poor, marginal farmers to moneylenders, often loathed by the community?
That’s because they can borrow from the moneylender, pay back the bank, restore their credit record and become eligible once more for loans.
Banks believe they are acting the good samaritans, but with moneylenders charging exorbitant rates of interest, farmers are finding themselves deeper in debt.
Small and marginal landowners often borrow bigger sums from the banks, because they don’t just have to buy seeds and fertilizers, but also need to pay off the moneylenders.
In case, the weather gods smiled and the farmer reaped a bumper harvest, things would have been different. But that doesn’t happen too often here in Vidarbha, and in the absence of even rudimentary irrigation facilities, the farmer’s are playing Russian roulette with their futures.
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First Published: Fri, Jul 11 2008. 07 28 PM IST
More Topics: Video story | Farmers | Loan waiver | Banks | Vidarbha |