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Our Bureau

Mangalore , June 18

THE Chairman and Chief Executive Officer of Karnataka Bank Ltd, Mr Ananthakrishna, has advised his staff to educate farmers and emphasise on loan repayment.

In view of mounting NPAs in the plantation sector, field-level functionaries should follow up and educate borrowers to meet their contractual obligations.

Mr Ananthakrishna said that this would encourage the bank to extend further need-based finance.

Mr Ananthakrishna was in Mangalore recently at the inauguration of `Agri Business Conference 2004' to finalise the bank's farm credit plan for 2004-05.

"We have to respond to the credit need of the rural area within the policy framework of the bank. While sympathising with the coffee growers, the Central Government has asserted that there will not be waiver of interest on coffee loans. As bankers, it is our responsibility to educate farmers, keep constant touch with them, and inculcate the repayment culture in them," he said.

Referring to the recent high-level meeting of bankers and coffee growers' associations convened by the Union Commerce Ministry, he said that the Union Government had turned down the plea of planters for waiver of interest on their restructured special coffee term loan (SCTL) accounts. Such a demand cannot be acceded to and the banks are bound by the guidelines of Reserve Bank of India on prudential norms and classification of loans.

The Government has also not considered the request of the planters' associations to reduce interest on fresh crop loans, he said.

Mr N.S. Chakkera, General Manager (Credit), said the agriculture advance of the bank grew by 27 per cent during 2003-04. The bank has advanced around Rs 250 crore to the coffee sector, he said.

Stressing the need for special attention to the coffee sector, Mr Ananthakrishna said planters were not repaying dues on time. He attributed this to decline in coffee crop and lack of improvement in coffee price.

More Stories on : Farm credit | Public Sector Banks | Karnataka

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