44
was Rs. 3.89 lakh but the loan outstanding never went beyond Rs. 70,244.
Similarly, KCC loan assessed in case of (A/c No 001621000001599) was Rs. 5.84
lakh but the loan outstanding never went beyond Rs. 99,900. In Uttar Pradesh,
cooperative banks disbursed 75% of credit limit as cash and the remaining 25%
as kind towards fertilizer, seed, etc. In Bihar, Begusarai DCCB provided the KCC
loan maximum of Rs. 50,000 per farmer (circular No 198 dated 18.03.2016).
Similarly, Magadh DCCB was providing maximum KCC loan of Rs. 82,500 to a
farmer having 5.0 acre of land. In Assam, the maximum loan amount to a farmer
was found to be Rs. 82,600.
3.37 In fact, it was reported by the officials of some banks as well as the farmers
interviewed that HDFC Bank was providing KCC as per the valuation of land
ignoring the Scale of Finance. The HDFC Bank has Agri Business Centre/branch
at Rudrapur, Uttarakhand and Bareilly, UP. Since the land value is very high in
Moradabad and Bijnore, the KCC sanctioned is much higher than what they would
get from Public Sector CBs, RRBs or DCCBs, who apply SOF for calculation of
KCC, and also the repayment capacity of farmers.
Collateral Security
3.38 As suggested in the revised KCC guidelines, no collateral security was being
forced by the banks for KCC limit up to Rs. 1.0 lakh as reported by the sample
farmers. However, the banks were insisting land mortgage for KCC limits above
Rs. 1.0 lakh in all the states. There were a few cases where land mortgage or
other types of collateral were not taken for KCC loans above Rs. 1.0 lakh (but
not in cases where loan amount was quite high). It was observed that banks were
mortgaging entire land which were recorded in the Land Possession Certificate
(LPC) or offered by the farmer for KCC loan and these were found to be very high
as compared to the quantum of loan. This practice was very common in almost
all the banks. Banks should mortgage only that much quantity of land value of
which should be able to cover the loan amount.
3.39 There were some other issues pertaining to the land records too. In the state
of Bihar, Maharashtra and Uttar Pradesh, delay was observed in updating the
Khatauni
(the register of all households cultivating or otherwise occupying land
in a village as prescribed according to the State Land Revenue Rules). It is a
document prepared as part of record-of-rights but not always done on real time
basis on ‘
Bhulekh
’ (the online Land Record system for Uttar Pradesh, being
implemented under the National Land Records Modernization Programme).
Accordingly, there are instances of mismatch between the physical records and
online records, since the mutation on transfer of property, which should officially
be done within 35 days, normally takes two to three months. The manual
khatauni
is maintained by the
lekhpal
and land registration is done by the tehsil office,
which takes about two months. Then the details are forwarded to the Revenue
Department, once in 15 days, which undertakes online registration. Therefore, if
a farmer sells a parcel of land immediately prior to applying for KCC, it becomes
difficult for the bank to ascertain the accurate record of rights. Therefore, in all
