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CHAPTER -1
INTRODUCTION
1.1. Introduction :
The capital formulation plays a crucial role in most the models of growth and
those savings into productive economic growth activities. Therefore, the role
agriculture isn't any exception thereto. Rather, the event of agriculture the
farmers square measure tiny and marginal, WHO square measure unable to
avoid wasting and invest because of their low levels of financial gain.
lives in rural areas causative about 25% to gross domestic product (GDP) and
Banking sector helps within the proof of the economy. Agriculture is the most
crucial sector of the Indian economy as a result of the most policies of output
growth, poverty alleviation, social justice and equity square measure best
served during this sector. so there's a necessity to increase the credit flow to
agriculture, raise the productive capacity of land and enhance the potential of
In India, there are a lot of sources available for Agricultural finance and these
sources mainly categorized into two categories :
Sources of
Agricultural Finance
Formal or
Inforaml Non
Organized
Agency Sources
Agency Sources
(i) Landlords
for inputs like seeds and other needful for the production and sell
interest on the loan and their respective commission on all the sales
and tobacco, etc. The small farmers who don’t want to get stuck in
heavy paperwork and other formalities they prefer to loan from this
(a) They are always ready to meet the emergency requirements of the
(c) No much paperwork or formalities are required to get the loan from
these money lenders, they just arrange a loan on the basis of some
(d) Because most of the money lenders belong to the same locations
where they have to lend the money so that they are personally aware
Govt. has launched a few schemes for financing the farmers, these loan
circumstances.
The Co-operative societies are running their operations since the year
the year, 1951 AIRCSC Analysed that there is not any better alternative
and State Government. There are a lot of schemes which are organized
by these societies for the benefits of poor and weaker sections of the
rural and backward areas. There are various schemes running by the Co-
Bank of Baroda
Agricultural Finance
PNB Agricultural
Finance
ICICI Bank
Agricultural Finance
AXIS Bank
Agricultural Finance
Fig. 1.2.2: Commercial Banks which Provide Agriculture Finance to
Farmers.
No doubt the role of a commercial bank is to done banking activities for the
earning purpose but there are few banks which provide agriculture finance to
the farmer comparatively lesser rate as compare to the house loan or vehicle
loan. It is also clear that providing loan to agriculture purpose is rather risky as
uncertain factors like the tendency of monsoon, weather conditions during the
RRBs are playing a dominant and most important role in agriculture finance in
rural India. These Rural Banks are established at that rural places where it is
Rural Bank in Punjab. On January 2019, two more Regional Rural Banks e.g.
Satluj Gramin Bank and Malwa Gramin bank have got merged into Punjab
Gramin Bank.
CHAPTER -2
REVIEW OF LITERATURE
Previously conducted work and researches are really helpful for the new
Kulkarni (1979) pointed in his research papers that no doubt the prime
motive of banking institute is to earning profit but on the other while obeying
their social responsibilities like agriculture finance to poor farmer etc. they
must reduce their profit margin for welfare of the farmers as well as of the
agriculture finance systems of Indian banks that loan should be provided only
& Shah, it is found during the study that subsidized loan is not approaching to
Planning and Agriculture Credit’ that bank should also arrange insurance
policies for livestock and agriculture so that the risk of farmers as well as the
loan amount that the families which are well settled and handsome earning
sources are not repaying the amount of loan taken by them from the various
banks for the agriculture purpose. The study was conducted on Agra District
India. The study was conducted on 16 different states of India, and it was
found in the research that regarding overdue clearance of PACs only 5 states
are showing their performance above the scale of Nationa wise average and
i) Karnataka
ii) Tripura
iii) Orisa
iv) Maharastra
v) Gujrat
And other 11 states including the State of Punjab performance was found
to analysis their financial margins. It is found in the study that it was negative
association towards the total loan and overdue. According to Singh & Singh, it
was found that there was a high amount was outstanding or pending as the
bank overdue.
and working of the Regional & Rural Banks of Punjab that Punjab Gramin
Banks are performing efficiently with the adequate debt equity ration.
According to their research, it found that amongst the Malwa Garmin Bank and
of Punjab Garmin Bank is better than the Malwa Bank. The financial solvency
& liquidity position of PGB is also strong then the financial and liquidity
Sub
Mountain
Zone
Undulating Western
Plain Zone Plain Zone
Agro
Climatic
Zones
Central Western
Plain Zone Zone
Agriculture is the backbone of the Indian economy and especially the state of
Punjab is popular in all over the world for its efficient agricultural skills and
hardworking farmers. But it is the bitter truth that most of the farmers are
under heavy debt. So that is why the agriculture sector in Punjab always
required finance for its agriculture operations. Financial requirement for
Types of Agriculture
Finance
natural climate like the condition of monsoon, timely and adequate rain, etc.
Maximum time cycle from sowing the crop till harvesting is 6 months e.g. in
Punjab Kharif Crop of Paddy/ Rice is sowing in the month of May to July and
its harvesting time is September to October. So the main motive of short term
credit is that farmer can return their credit after the harvesting of their crops.
The following are some short term requirements to meet them farmers have to
financing. PSCB was come into exit in 1949 to providing strength to Co-
operative banks. The following are the schemes which are operated by the
1) Crop Loan: Crop Loan is also known as Short Term Agricultural Loan.
In this type of scheme loan is provided for the short term on the basis of
Beneficiary Farmers
3) RCC: This is a special scheme for the individual farmers who are the
holders of the land. Under RCC scheme loan is provided to the farmer to
meet his social or economic requirements on the basis of following
The motive of the loan To meet the credit requirements of the farmer
regarding his social or economical needs.
Beneficiary Farmers
Table: 3.3 Terms for Resolving Cash Credit Schemes For The Farmers.
Source: Official Web Site of Punjab State Cooperative Bank
business only to the farmers who are the members of Milk Producers
Societies:
The motive of the loan To meet the credit requirements of the member
farmers who are dealing the dairy farming
activities.
Beneficiary Members Farmers of MPCS
Loan Repayment System Maximum 5 years from the date of the loan
the loan is provided to the poor farmer at a lesser rate for the education
The motive of the loan As per the norms of RTE, the main purpose of
their children.
Table: 3.5 Terms for Resolving Cash Credit Schemes For The Farmers.
Source: Official Web Site of Punjab State Cooperative Bank
As it is clear from the name Punjab Gramin Bank means a Bank for the
There is various kind of schemes which are operated by the Punjab Garmin
Bank, but the following are the schemes which have to be reserved only for
This scheme has been started for the farmers of Punjab to meet their
The motive of the loan This scheme has been started for the farmers of
Beneficiary Farmers
Table: 3.3.1 Terms for Resolving Cash Credit Schemes For The Farmers.
Source: www.bankbazar.com
ii) PGB Farm Mechanisation Scheme:
and conditions :
The motive of the loan Farm Mechanisation Scheme of Punjab Gramin Bank is
Beneficiary Farmers
As it is clear from the name of the scheme that it is launched by the Punjab
Gramin Bank for the benefits of Dairy Farmers. Dairy Farming business is an
expensive business so that funds are required for land, labor purchase of
livestock and technical know-how. The loan is provided by the PGB on the basis
Beneficiary Farmers
Limit of the loan Depends upon the size of the business maximum up to 5
Lakhs.
Loan Repayment System Depends upon the equipment usage
Security Rs. 50000 or one animal like buffalo or cow without any
Kisan Suvidha Scheme is operated by Punjab & Sind Bank for the benefits of the farmers
of Punjab mainly for the agriculture purpose. This facility is provided only to those farmers
who are the holder of Kisan Credit Card Scheme and the conditions are that the holder of
the KCC must have the satisfactory record for at least previous last year. A farmer can avail
Limit of the loan Maximum Rs. 5 Lakhs or Rs. 50,000 per acre of
land
Loan Repayment System Three Years to 5 Years from the day of loan
granted
Card Scheme.
In Crores
It is clear from Table 4.1 and the fig. 4.1 that Commercial Banks are playing a
vital role towards the contribution in agriculture finance e.g. among the total
Commercial Banks and after the Commercial Banks Co-operative Banks are
contributing their share towards agriculture credit. It is clear from the above
table that Co-operative banks are contributing approximately 28% towards this
Regional Rural Banks are also providing their services to agriculture sectors
via offering special subsidies to the farmers and their contribution is 11% of
area.
Co-operatvie Banks
28%
Commercial Banks
61%
Regional Rural
Banks
11%
important scheme for the benefits of the farmers of the State of Punjab to meet
the Punjab Gramin Banks before the amalgamations of Satluj Gramin Bank of
Punjab and Malwa Gramin Bank in the Punjab Gramin Bank as on 1 st January
2019 is as under :
Bank
Gramin Bank
Gramin Bank
Bank
Gramin Bank
Gramin Bank
It is clear from table 4.2 and table 4.3 that performance of the Kisan Credit
Card scheme is at its best by the Punjab Gramin Bank. It is clear from the
Table 4.3 that the average or mean number of cards alone issued by the Punjab
Gramin Bank is more the colletive average number of cards issued by Satluj
Gramin Bank and Malwa Garmin Bank. Average Number of Cards issued by
Punjab Gramin Bans was 15,337. 17 and the collective performance of SGB
and MGB is 1430.33 + 7338.83 = 8769.16 which is only 57% of the card
15337.17
7338.87
1430.33
of Punjab.
On the basis of table 4.3 it is clear that average amount lent on under the Kisan
Credit Card Scheme by Punjab Gramin Bank is more than double the
collective amount lent to the farmers by the Satluj Gramin Bank and the
9317.42
3604.92
It is clear from the fig. 4.3 that Punjab Gramin Bank is operating more
efficiently as compare to SGB and MGB. But is also clear from the above
tables and figures that Regional Rural Banks are performing best for Rural
Punjab and Kisan Credit Card Scheme is serving with its potential to rural
Punjab.
CHAPTER-5
FINDINGS, LIMITATIONS &
SUGGESTIONS
Findings
SUGGESTIONS :
CONCLUSION
Conclusion :
It is clear from the above discussion that agriculture credit plays an unbeatable
role in economic development by financing to such sector which produces food
for the entire nation. In the case of employement, the agriculture sector still has
to contribute approximately 1/3rd of the total gross domestic product directly or
indirectly. There are various formal or informal sources of agriculture credit in
India, which provide finance for agriculture and associated activities for the
development of the rural sector. Indian agriculture is considered as the most
important and oldest Industry and even then it is in its developing stage due to
its highest dependency on unpredictable natural climate and due to uncertain
weather conditions various times farmers have to face the loss of crops an even
some just few days before the harvesting and that is why most of the Indian
farmerms are still living under the poverty line.
Abbreviations :
CB Commercial Banks
REFRENCES
&
ANNEXURES
References :
Gulati, A, and Verma, S; 2016. From Plate to Plough: A clear trend towards on-
vegetarianism in India, Indian Express.
Krishna, Veni L., and Sah, Ash Narayan, 2005. Direct Institutional Credit to
Agriculture and Allied Activities-Changing Scenario. ICFAI Journal of
Agricultural Economics, Hyderabad.
Nair, G.K., Thirumal, R. (Eds.) “Profitability and growth of regional rural banks
(RRBs) in India (with reference to the profit-making RRBs)”
Raul, R.K. and Ahmed, J.U., 2005. Public Sector Banks in India− Impact of
Financial Sector Reforms. Delhi: Kalpaz Publications.
Singh, Amarjit, and Singh, Parminder, 2010. Technical and Scale Efficiency in
District Central Co-operative Banks of Punjab - A Non-Parametric
Analysis. Indian Co-operative Review, Vol. XXXXVII, No.1, (Jan.),
New Delhi.
Web Pages
https://nfsm.gov.in/nfmis/rpt/calenderreport.aspx
https://icrier.org/pdf/Punjab%20Agriculture%20Report.pdf
https://blog.bankbazaar.com/punjab-gramin-bank-scheme-for-financing-under-pgb-krishi-
card-kisan-credit-card/
ANNEXURE -1