Sunday, 17 July 2011

What are the prerequisites of successful agricultural credit or rural credit programme ?

Agriculture Credit or Rural Credit :-
Following are the prerequisites of successful rural credit programme :

1. Character of the Borrower :-
The lender should keep in view the reputation and purpose of borrowing. If one farmer is honest and capable to use the loan for productive purpose then he must be tended.

2. Appointment of Credit Officers :-
The lending agency should appoint the credit officer who has rural background. If a credit officer belongs to the farmer's family then he can understand the problems of the farmers in better way.

3. Regular Relationship :-
The relationship between the borrowers and credit officer should be regular. It is very useful in obtaining and repaying the loan. If the farmer has no contact with the banks then they will be unable to avail the credit facility on low rate of interest.

4. Mobility :-
The credit officer should always remain on tour. He should check utilization of credit at the spot. At the time of sowing and harvesting he should go in the fields.

5. Individual Responsibility :-
The loans should be advanced to an individual farmer and two person should give guarantee any person delays then other two persons will also ask him for the repayment because they will also be responsible.

6. Credit in Kind :-
Credit should provided in the shape of kind and not in the shape of cash. For example if we advance the loan in kind of seeds or fertilizer to the farmer then he will be unable to use this loan for other purpose.

7. Credit at the Door Step :-
Credit must be provided at the door step in this way a lot of precious time of the farmers can be saved. For example if the bags of seeds are at the door then he is unable to sew them.

8. Productive Approach :-
The loan should be provided for the productive purposes. It should also be according to the requirement of the farmers. If the loan is excess or less than the actual requirements then it will not be useful.

9. Simple Procedure :-
The procedure of borrowing should be very simple and there should be one source of taking loans. If a farmer has to contact different sources then he will hesitate to borrow.

10. Preference to Small Farmers :-
The small farmers should be preferred while advancing the loan. Most of small farmers are very poor and they can not use the modern inputs. So the small farmers will be able to cultivate the land properly. In this way per acre output can be maximum.


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