The Fact News Service
Chandigarh, May 6
To bring major reforms in the functioning of Cooperative Banks, Chief Minister Bhagwant Singh Mann today ordered to expedite the process of recovery from defaulter account holders of these banks so that there is no hindrance in lending to agriculture and allied activities.
During a meeting held today at the official residence of the Chief Minister here, while reviewing the progress of the functioning of Cooperative Banks, the Chief Minister said that defaulters are the biggest obstacle in the development of banks because the money stuck with them hampers financial assistance to other needy people. The Chief Minister said that small and medium farmersalways return loans to banks on a priority basis, but it is unfortunate that large farmers are defaulters of cooperative banks. He also said that the government employees who have taken loans from Cooperative Banks to repay their dues immediately. Bhagwant Singh Mann directed the Cooperation Department to adopt an appropriate process to recover from defaulters so that complete recovery of loans can be ensured.
Expressing dissatisfaction over the recovery of crop loans being only 65 percent, the Chief Minister said this is having a very bad effect on the cooperative banking system. He said that cooperative banks offer a 3% interest rebate on timely repayment of crop loans, yet many farmers do not repay loans, resulting in not only paying higher interest but also being deprived of taking loans or other benefits in the future. The state government would not accept discrimination with our farmers.
During the meeting, it was informed that farmers in the state are given approximately Rs. 8000 crore in crop loans every year through 3523 cooperative societies via cooperative banks. This is provided at an interest rate of just 7% and if the farmer repays on time, they get a further 3% rebate in the interest rate. On the contrary, farmers who do not repay on time have to pay 2.5 % extra interest, which becomes 9.5 percent.
To encourage primary agricultural cooperative societies (PACS) with excellent crop loan recovery records, the Chief Minister directed the department to honour such cooperative societies in a special way so that they can be projected as role models in the cooperative sector. It was informed during the meeting that the cooperative societies under the Dhuri circle have a loan recovery rate of 99 percent and the Dhuri circle has emerged as a model. Bhagwant Singh Mann also instructed to organize a function to honour these societies.
Expressing concern over NABARD reducing the annual limit of concessional refinance loan for the year 2024–25, the Chief Minister said that Punjab contributes the most to the nation’s food security and such a cut in the loan limit has adversely affected the agriculture sector. Bhagwant Singh Mann said he will take up this issue with the NABARD Chairman to reinstate the loan limit to Rs 3000 crore for the financial year 2025–26.
Giving a green signal to end the dual leadership system of Managing Director (MD) and District Manager (DM) in District Central Cooperative Banks, the Chief Minister said that there should be a single officer heading the bank so that the functioning can become more effective and responsibility can be clearly fixed.
Meanwhile, Chief Secretary KAP Sinha, Chairman The Punjab State Cooperative Bank Ltd. Jagdev Singh Bam, ACS-cum-Financial Commissioner Cooperation Alok Shekhar, Principal Secretary Finance Krishan Kumar, Principal Secretary Food and Civil Supplies Rahul Tewari, Principal Secretary to Chief Minister Ravi Bhagat and Special Principal Secretary Kumar Amit, Registrar Cooperative Societies Vimal Kumar Setia and MD The Punjab State Cooperative Bank Ltd. Harjeet Singh Sandhu were also present in the meeting.
