Farmers aiming to repay waived loans, redeem pride

By Gopika and Tapsi Ramchandani, CNBC-TV18:

A matter of honour

One of the biggest arguments against the farm loan waiver has been that it will ruin the credit culture and encourage farmers to default. Farmers in Induri and Thara villages think that it is their "Marathi pride" to repay.
 
Two years back, Avanish Mokal of Thara village would have found it difficult to repay his loans. His poultry business was running under loss after the prices fell due to the bird flu scare. After 25% of his debt was written off under the farm loan waiver scheme, Avanish says he is confident of repaying the 75% loan on time. Avanish Mokal, Poultry Farmer said, "I want a good credit with bank. It's a matter of my reputation." 

Farmers like Avanish prove that branding all waiver beneficiaries  as future  defaulters is entirely incorrect. Ramesh Divsi of Induri village had taken a loan of one lakh rupees three years back. He was not able to repay this loan because he lost all his crops to heavy rainfall. But now with his debt waived off under the debt waiver scheme, Ramesh is ready to start afresh and be regular with his repayments. Ramesh Divsi, Farmer said, "I had the hope of repaying my loan but government waived off all my loans. Now I can work hard and repay my future loans on time."
 
Farmers like Ramesh and Avanish are not wilfull defaulters. For these farmers it's a matter of pride to have a clean record with the bank. Bankers who deal with them say its wrong to belieive that farmers will default on purpose.
 
Amita Nambiar, Branch Manager, Bank of Maharashtra said, "The government's farm loan waiver scheme is not a harbinger of bad credit culture. For many farmers it is only a step to a new begining."