Impact study on crop loan among farmers

in rural branch veerakeralam (SBI)

Presented by
N.Rahul Tagore
2016600116
II MBA (ABM)
Contents

Introduction
History
Contribution
Research motivation
Research methodology
Data Analysis & Interpretation
Recommendations & suggestions
Conclusion
Executive summary
Seminar Title Impact study on crop loan among farmers in
rural branch Veerakeralam (SBI)
Organization SBI (Veerakeralam)

Areas covered Veerakeralam, Thondamuthur, Nagarajapuram,

Devarayapuram, Narasipuram
Supporting Officer T.Jayanthi (Deputy manager) Advances

Chairperson Dr.K.Divya Assistant professor (ARM)

Advisory Committee Dr.N.Deepa (AP) , Dr.M.Radha (AP)

Introduction
Crop Loan is a short term advance which is given by the banks
and co-operative societies who deals in financial sector.
Term period of crop loan

Below 1 year

Except sugarcane ( 18 months )

Characteristics
1. It was on the basis of a crop and not on the basis of a title.

2. It had to be proportionate to the estimated outlay on raising the

crop.

3. It was production oriented finance.

4. The recovery should be effected as and when the crop was sold
from the Proceeds of the sale.
History
Under the recommendation gave by the Agricultural finance
sub committee (1945) short term loans were given on
production oriented on basis of requirement of crop.
This short term loan was later replaced as crop loan. This was
the main background laid down the procedure for providing
crop loan to farmers.
Crop loan scheme became operational from the year 1950
Recent Changes
All crop loan accounts should be compulsory linked with
Aadhar card.
Loan debt waiver is going to take place in all the states
gradually.
Every crop loan receiver should compulsory pay Insurance
premium to bank
Agriculture contribution in GDP

Source : Reported in NABARD Annual report 2016-17

Research motivation
Banks cannot solely rely on the fact that crop loan by banks is
most utilized by the farmers hence a small research work to be
done in order to know the impact of crop loan among farmers.
In India the contribution to GDP of crop loan was reduced by
0.42% from 6.65 lakh crore to 6.23 lakh crore in the year
2016-2017 reported in NABARD annual report 2016-17.
Research methodology
Objectives of study
To study the impact of crop loan on farmers

To understand the constraints in obtaining crop loan

scheme.
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Sample size & design

The simple random sampling method was followed.

The sample consisted 30 farmers

Questionnaire

A well structured questionnaire in simple and understandable

language.
Type of data

Data collected primarily from farmers.

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Organisation of study

Veerakeralam branch (SBI)

Limitations of study

1) Unable to collect information from farmers living in deeper parts of

village.
2) There may be bias in the responses of farmers due to reasons such as
suspicion, apprehension.
 i e w
R ev
S.no Author Title Conclusion

1. Harwant A study of credit Commercial banks should

Singh requirements and follow village adoption
(1971) advances to farmers in scheme
Patiala district

2. Dr. Agricultural debt waivers It was a welcome move

Dnyandeo and debt relief scheme which was expected to open
C. Talule up the lines of credit from the
(2008) banks for millions of Indian
farmers.

3. IKANI, An Impact Assessment of Banks should open up

Daniel Agricultural Credit on branches in rural areas and
Idoko Rural Farmers in avoid unnecessary stringent
(2013) (Nigeria) credit conditionality's that
will discourage farmers from
borrowing.
4. Dr. G A Study on Customer Bank has to make proper
Nagarajan Awareness towards services to the customers
Mr. A. Asif Loan Products & to increase the purchase
Ali Services in Bangalore and performance of the
Ms.Gowhar with Special Reference bank.
Jan.S to State Bank of India

5. Sunny Ibe The Impact of Agricultural scheme loan

Obilor Commercial Banks has led to a significant
Credit to Agriculture on positive growth in
Agricultural agricultural productivity
Development in Nigeria.

6. Abdul Banking role and loan (ABC),(ADBC) &

rehman schemes for agricultural National Bank of Pakistan
Laun development in china & and Khushhali Bank
jingdong Pakistan Limited are leading
Yuneng du banks helps in improving
economy by issuing
loan's in Agri sector.
7. Shasikanth A study on attitude & Supervision to prevent the
Reddy utilization of crop loan misusing crop loan
(2013) by farmers of Bihar state

8. Dr.C.S.Gajar Study on Short Term More percentage of crop

ajan (1992) Agriculture Credit in loan was allotted for non
Maharashtra food grain crops highest
percentage was allotted for
Sugarcane
 o rk
c h W
s ear
R e
Analytical tools used
1) Percentage analysis

No of respondents / Sample size * 100

2) Correlation

Assessing the relationship between two or more variables.

3) Regression (Multiple linear)

4) Likert scaling in questionnaire

Factors considered
Age

Education

Income

Land holding

Crop category

Farmer category

Duration

Crop loan Satisfaction

Percentage analysis
Majority of farmers responded are male ( 90% )
Age of farmers

Age of respondents
category number per cent
20-30 0 0
30-40 8 26.67
40-50 21 70
50+ 1 3.33
total 30 100
Here majority of farmers are choosing crop loan based on
Neighbor's words and other reasons where as by low
interest rate is least

Reason for choosing crop loan

Category Frequency Percentage

By convenience 7 23.33

Low interest rate 1 3.33

Neighbor's & family 11 36.67

Others 11 36.67

Total 30 100
Crop loan satisfaction level
Satisfied Highly satisfied Neutral

Dissatisfied Highly dissatisfied

6.67%

23.33%

23.33%

26.67%

20.00%
 Perception about crop loan
Not useful Useful Moderately useful Very useful

10.00%
13.33%

33.33%

43.33%
 Farmers suggestion on information services

100

90 86.67

80

70
Need to improve info providing
60 services Frequency

50
Need to improve info providing
services Percentage
40

30
30 26

20
13.33
10
4
0
Yes NO Total
Analyzing relationship between age and education
(Correlation)

Interpretation- Age and education are negatively correlated. As age

increases the level of education within farmers is low.
Analyzing relationship between income and land
holding ( Correlation)

Interpretation Here category land holding and income are

positively correlated. Hence with increase in size of land holding the
income output also increases.
Multiple linear regression
Recommendations & suggestions
Conduct awareness campaigns, village stalls and improve
advertisement.
Making them aware of crop insurance along with crop loan
which is more useful for farmers.
Maintain communication and good relationship with farmers.

Target people who are not availing the scheme and make them
aware of utilizing crop loan.
Conclusion
According to the study most of the farmers are satisfied with crop
loan by achieving good yield.
Farmers said that crop loan scheme is one of the best scheme
provided by government which gives timely credit.
Also government providing subsidy to farmer if timely repaid
interest which is most beneficial to farmers.
Also some of the farmers are not aware of crop loan scheme and
hence they feel the need to improve information providing services.
References
https://
www.sbi.co.in/portal/web/agriculture-banking/crop-l
oan
http://
www.nabard.org/auth/writereaddata/tender/2308
170405Nabard%20Annual%20Report%202016-2017-EN
GLISH.pdf
http://www.svtuition.org/2010/06/crop-loan.html
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en.m.wikipedia.org/wiki/kisan_credit_card

sbi.co.in/AR1617/PDF/English/Notice.pdf
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