NABARD - REFINANCING AGENCY FOR RURAL CO-OPS IN INDIA

Nabard to open liquidity facility for cooperatives

National Bank for Agriculture and Rural Development (NABARD) will open a special liquidity assistance window for cooperative credit institutions, including state cooperative banks (SCBs), to tide over any tight resource conditions arising out of implementation of the farm debt waiver and relief scheme.

NABARD of India is the refinancing agency for rural cooperative organisations. "If the cooperative banks face resource constraints in the course of implementing the scheme, we will make financing arrangement to ensure that working is not affected," NABARD executive director S K Mitra said after meeting the chief executives of SCBs. The refinancer could borrow from the market to provide assistance to cooperative entities. It has already raised over Rs 100 crore through one-year paper that carries a 9.3 per cent coupon rate.

These bodies have already availed credit and have repayment obligations. In case they find it difficult to pay the instalment, the repayment time table could be rescheduled, he added. Asked about the feedback from CEOs on the problems in implementing the scheme, Mitra said the shortage of staff could become a hurdle. Meanwhile, NABARD chairman Umesh Chandra Sarangi told the CEOs about acute incidence of distress among the farmers. This should be the exclusive concern of the credit delivery system and cooperatives, he stressed.

NABARD also asked them to work out the cash flows and credit requirements before June 30, so as to ensure fresh loans to the distressed farmers.