Maharashtra government has approved a bank guarantee of Rs 2,000 crore to district cooperative banks so that farmers are able to avail crop loans. These banks are predominantly in Vidarbha, Marathwada and North Maharashtra.
The cooperative banks had sought additional monetary help from the Government. Marathwada Rural Bank and 16 other cooperative banks had demanded additional Rs 2,000 crore for distribution as crop loans among farmers. This step by banks were taken due to restructuring of loans since the last three years (2013-14, 2014-15 and 2015-16), and due to drought situation whereby farmers were unable to repay installments of loans.
Further, the state government has instructed cooperative banks not to recover pending loan amount from farmers’ crop insurance payments deposited in their bank accounts.