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MP farm loan NPAs surge 24% on loan waiver promises

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MP farm loan NPAs surge 24% on loan waiver promises

| Dec 21, 2018, 03:25:03 PM | GIST

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Farm loan waivers are bad news for banks as well as farmers. Anticipating relief, farmers start skipping repayments, impacting bank finances. Banks, in turn, go slow on fresh loans until state governments reimburse the amount written off, which often happens over several years. Latest available data shows that farm related non-performing assets in Madhya Pradesh doubled to 10.6% of advances in a little over three years between 2014-15 and June 2018. In just a one-year period ending June, NPAs on farm loans in the state rose 24%, according to the state-level bankers' committee.

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