SLBC agrees to stop recovery proceedings

THIRUVANANTHAPURAM: The state level bankers’ committee (SLBC) convened by chief minister Pinarayi Vijayan here on Wednesday decided to suspend recovery procedures on all types of bank loans availed and defaulted by farmers in the state, till December 31, 2019. The meeting also decided to fix the cap on interest on

agriculture

loans at 9%.

SLBC will also direct member banks to provide fresh loans to farmers for resuming agricultural activities, irrespective of any default on earlier ones, and the interest on new loans for the initial year will be borne by the state government.

The SLBC also took a favourable stand on the government decision to bring all commercial banks under the purview of the state farmers’ debt relief commission. If this requires any technical approval from the Reserve

Bank of India

(RBI), both the state government and the SLBC would bring it to the attention of the central banking institution.

Addressing the meeting, the chief minister urged the SLBC representatives to direct all banks to suspend recovery procedures on all loans availed by farmers. “The banks should empathize with farmers’ miseries and take a compassionate approach to provide them some relief. Farmers repay all types of loans they take with the income they generate from farming. And, this income has been severely hit by last year’s floods and several other issues in the agricultural sector,” Vijayan said.

Seeking the whole-hearted cooperation of the banks in implementing the moratorium, Vijayan asked the SLBC not to allow any bank to violate the government decision. “Besides, the farmers will require fresh loans to continue with cultivation on their land. So, they shouldn’t be denied new loans citing default of earlier ones,” he said.

The meeting was attended by finance minister T M Thomas Isaac, agriculture minister V S Sunilkumar, revenue minister E Chandrasekharan, cooperation minister Kadakampally Surendran and water resources minister K Krishnankutty, besides officials headed by chief secretary Tom Jose, SBI general manager Aravind Gupta, Kerala Grameen Bank chairman Nagesh G Vaidya and SLBC convener G K Maya.