Wilful and non-wilful default in Agricultural Credit

Abstract

Present study is an attempt to analyze the default in repayment of loans and to take suitable measures to minimize over dues. The study is based on the 90 borrower farmers comprising of 25, 25, 25, 15for marginal, small, medium and large farmers respectively which were collected from five villages of Manihari block of Ghazipur district of eastern Uttar Pradesh. The study revealed that the 64 percent borrower farmers were found to be defaulters and 36 percent borrower farmers were non-defaulters. The ratio between wilful and non-wilful defaulters of total defaulter were found in equal numbers in the sample. The study further analyzed the non-wilful defaulter and find out the number of chronic defaulters on the basis that these type of defaulters have no any income even they are not in position to meet out their family consumption expenditure. Such type of defaulters were indentified. 34.48 percent of the total non-wilful defaulter and accounted 48.59 percent over dues of the total ovedues. Farmers wise defaulters were further analyzed and their numbers were found 12, 18, 17 and 11 on marginal, small, medium and large farmers respectively. The percentage of ovedues of the total over dues were reported 46.94, 24.93, 16.82 and 11.31 percent on different categories of farmers. The amount of outstanding loan per defaulters was higher on wilful defaulter and over dues were higher on non-wilfuldefaulters in the sample farmers. The government and bank official should take utmost care at the time of disbursing the loan and ensure that it must be sanction based on farmers repaying capacity strictly.