Yavatmal: The Vidarbha region in Maharashtra has been in the news for a few years because of a spate of farmer suicides. To understand the impact of the government’s populist farm loan waiver scheme in this region, Mint has partnered with Dilasa, a non-governmental organization that works in rural Maharashtra. Dilasa’s volunteers will, in the run-up to the deadline of 30 June, visit farmers, banks and local administrators in Vidarbha’s Yavatmal district and file daily reports on the waiver scheme. This is Day 2.
With less than a week to go for the 30 June deadline to implement the farm loan waiver package, most banks are busy finalizing the list of farmers who would qualify for relief.
From clerks to cashiers to managers, everyone is engrossed with the list. What is the total outstanding debt? Who owes how much to the bank? Is he a small, marginal or other farmer? And, could he claim waiver of the entire debt or seek only partial relief? Bank staff in Vidarbha is immersed with these questions.
Preoccupation with the scheme has affected the regular work at these banks. As a result, new loan seekers are either being turned away or asked to wait until the waiver is fully implemented. The impact is being felt more at this time as the new crop cycle has begun in the region and farmers need fresh loans to buy seeds.
“Since I was regular in paying back my loan, I have not been covered by the waiver,” said Soma Raju Parchake, an Adivasi farmer in Ghatanji, a taluka in Yavatmal. “I did not repay my last loan in the hope that I would be identified as a beneficiary of the scheme. But, that did not happen. Now the bank will not give me a fresh loan. I have no option but to approach the local moneylender,” he said.
“This scheme has turned customers with good credit history into debtors.”
Like Parchake, Datta Bhaurao Kadu was also hoping to find his name among the beneficiaries, but his prompt payment record became an obstacle. “I owe Rs14,000 to a bank. I did not repay this loan as I thought the waiver scheme would cover me. I am now a debtor and ineligible for new loan. I would have to go to a private moneylender, who I know, would rob me.”
There is little joy for the lucky few who would end up on these lists. Once the names are finalized, senior bank officials would tour rural branches and revisit calculations.
The process would delay the announcement of names and in turn the disbursal. Timing is crucial, especially in Vidarbha, where sowing has already begun. “We cannot disburse fresh loans until we get a directive from our head office. This could delay disbursal of new loans,” said Dipak Vittal Narlawar, branch manager of Yavatmal District Cooperative Bank in Ghatanji.
“While the old debtors will be stuck off our records, new creditors will be added. We expect a very high default rate among the new creditors as many of them will not pay back their loans hoping to be (future) beneficiaries.”