Institutional Credit of Agricultural (Extent of Repayment, Over Dues and Factors Responsible for Over Dues) - Study with Reference in the State of Rajasthan

The overall scenario of the sampled farmers in the state of Rajasthan reveals that the total costs of obtaining credit borne by the farmer borrowers is Rs.2290.28 in which Rs.904.27 was spent on personal visits made by the farmer for obtaining credit, Rs.676.00 on on getting various records involved in the processing the credit and Rs.668.03 was paid to the bank during the processing of credit. The study shows that out of 160 sampled borrowers, 72 borrowers used their credit completely, 32 went for complete diversion of credit and rest utilized their credit partially. The repayment performance indicates that only 87.77 per cent of short-term credit, 83.05 per cent of medium-term credit and 74.40 per cent of long-term credit borrowed from the banks was repaid by due date and the remaining was over dues as on the due date. The regression results show that non-farm income, farm income and cropping intensity affected amount of overdue negatively while amount spent on un-productive purposes, old debts, amount borrowed and expenditure on family consumption had positive impact on the amount of overdue of sampled farmers. The major problems faced by the farmers while delaying with these agencies included inadequate loan amount, insufficient time for repayment, cost of borrowing, lack of knowledge of banks formalities and lack of technical guidance. Prevalence of corrupt practices and non-cooperation from banking officials are major structural constraints in procurement of credit in mentioned districts. A major infrastructural bottleneck in the study areas is insufficient credit agencies that lead to low scale of finance in the study area.