Andhra farmers are going to receive loans after Chief Minister, Mr N. Kiran Kumar Reddy requested banks to step up lending during Rabi season. In the 176th State Level Bankers Committee meeting, Reddy said that banks will have to repeat their performance as in 2010-11 when their advances crossed the target by more than 18 percent. As of Sept 30th, 2011, banks have disbursed crop loans amounting to Rs 21,601 crore.

The Andhra government announced that it will bear interest burden of farmers’ loans from the current rabi season onwards for crop loans up-to Rs 1 lakh. The ‘pavala vaddi’ scheme also has been extended for loans up-to Rs 3 lakh from the existing limit of 1 lakh. This measure is taken keeping into view the perennial neglect of small and medium enterprises by banks. So, increasing agricultural credit is considered to be priority for Andhra banks.

During the current fiscal year, banks also issued ‘loan eligible cards’ to 5.77 lakh tenant-farmers. In this financial year, 1.81 lakh tenant-farmers received credit as against 95,000 in the last fiscal year. A craving need has been felt by both banks and government to work hand in hand for prompt repayment of loans and to receive financial benefits associated with it.