Published On : Fri, Jan 1st, 2016

444 farmers loans worth Rupee 94.21 lakh waived off

Nagpur: Loans of 444 farmers belonging to Nagpur, Umred, Katol,Hingna, Mauda, Kalmeshwar, Ramtek, Saoner, Kuhi, Parshivani, Narkhed talukas have been waived off. The loan amounted to Rs 94.21 lakh, informed district collector Sachin Kurve.

He informed that the loans worth Rs 10.88 crore of 6269 farmers have been waived off in Nagpur district alone. They had taken loans from 281 moneylenders.

The state government has already decided to redeem the jewellery worth Rs 17.29 crore pledged by the farmers with the private licensed money lenders. This measure is going to benefit 8500 farmers in Vidarbha.

It may be noted that the farmers regularly take loans from the private moneylenders and they spend the rest of their life paying the interest thereon. Thus they are caught in the vicious circles. When the microfinance institutions opened their offices in the rural areas, they had got some relief and but after their closure, the private money lenders are back in business, grabbing the space vacated by microfinance institutions following the state government’s decision to curb the micro-lending business of private players. Since the catchment area is huge — over 80 per cent of borrowers in the rural areas of the state rely on informal sources for timely credit — moneylenders, pawn brokers and middlemen are charging as high as 225 per cent interest rate per annum.

According to a survey, traditional moneylenders, who only lend to people with whom they have a long-term credit relationship, are charging interest at 36-120 per cent per annum.

The rate is much steeper, 160-225 per cent per annum, for weekly moneylenders, who are outsiders and visit villages to lend money. However the farmers get loan only after pledging their gold and silver ornaments.