PROBLEMS FACED BY FARMERS WHILE AVAILING AGRICULTURE CREDIT SANCTIONED BY FINANCIAL INSTITUTIONS IN TAMIL NADU

ABSTRACT

Agriculture is the most important component for the sustainable development of a nation. Until 1935, the major sources of funds for the farmers was dominated by the professional money lenders. Due to the high rate of interest, farmers were heavily burdened with debts. Later, Government of India has considered all the issues and problems faced by the farmers to meet overcome the issues the Government of India established the agricultural credit policy through various institutional agencies. Still there exists a lack of rapport between the bankers and the farmers in obtaining as well as in repaying the crop loan. The present study was carried out with the main objective of understanding the problems faced by farmers while availing agriculture credit from the ?nancial institutions in Tamil Nadu. The result indicated that the major problems faced by the farmers in obtaining the institutional credit were the non-availability of loan on time, the procedure for obtaining the credit was more expensive, Inadequacy of loan amount, Lack of Knowledge about agricultural credit, Dif?culties in ful?ll the loan applications, Lack of awareness about various loan schemes offered by bank, inadequate in the scale of ?nance. Inadequacy of loan amount is the most important problems faced by the farmers while availing the agriculture credit. The bankers need to provide suf?cient loan amount to the farmers. Thus this study concluded that the agricultural credit needs of farmers are increasing with the increase in cost of cultivation. The Government should update its credit policy, to meet out the credit needs of the farmers.