Monday, January 15, 2007
I express my heartful thanks to the Reserve Bank Of India.
A recent directive issued by the Reserve Bank of India (RBI) to commercial banks should bring cheers to distressed farmers who have been affected by calamities. As per this directive, farmers will be offered a one-time settlement (OTS) of their dues and not only that, they will be offered fresh loans thereafter.The directive is in line with the recommendations mentioned in the mid-term review of RBI’s annual policy for 2006-07. These recommendations are made by a working group constituted by RBI to suggest measures for assisting distressed farmers.
So far it used to be the practice that banks would either reschedule or restructure dues of farmers but such consecutive rescheduling would not improve the lot of farmers. Therefore, for the first time, RBI has asked banks to devise OTS for such
farmers and make them eligible for taking fresh loans.
(Please see the RBI notification)