Decision on farm loan waiver in Karnataka only after state govt prepares guidelines: Canara Bank

The response came in the wake of reports about bankers being skeptical of writing off farm loans.

Press Trust of India July 26, 2018 07:01:20 IST
Decision on farm loan waiver in Karnataka only after state govt prepares guidelines: Canara Bank

Bengaluru: Amid reports of banks' reluctance to waive farm loans in Karnataka, Canara Bank on Wednesday said a decision on the issue can only be taken after the state government prepares its guidelines.

"Two committees set up for Grameen and commercial banks are going to meet on 1 August to deliberate on the government's suggestions on the modalities to waive farm loan," Canara Bank Executive Director Matam Venkata Rao told reporters here during the Q1 results of the bank.

"Once the committees deliberate with the government, then they will come out with final guidelines," he said.

The response came in the wake of reports about bankers being skeptical of writing off farm loans.

Decision on farm loan waiver in Karnataka only after state govt prepares guidelines Canara Bank

Canara Bank logo. Reuters

"The guidelines will then be placed before a competent authority and thereafter, a decision will be taken with regard to farm loan waiver," Rao added.

Only after drafting of the guidelines, the bankers would be able to prepare the list of defaulters whose loans would be waived, Rao said.

The bankers' committees were formed during a State Level Bankers Committee meeting with Karnataka Chief Minister H D Kumaraswamy.

The delay in waiving loans has upset the farmers, who have given a 15 August deadline to the government. They have threatened to go on statewide bandh if the government failed to take steps in this regard.

Kumaraswamy had unveiled a Rs 34,000 crore farm loan waiver in his 5 July budget. A week thereafter, he announced additional farm loan waiver amounting to Rs 10,700 crore.

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