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Rural Credit Delivery System in Maharashtra: Some Emerging Issues


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1 Gokhale Institute of Politics and Economics (Deemed University), Deccan Gymkhana, Pune- 411 004 (Maharashtra), India
     

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An investigation into rural credit delivery system in Maharashtra shows slower growth in institutional finances through commercial banks, credit cooperatives, RRBs and LDBs, particularly during the decade of 1991-2000, which is mainly due to adverse environment created by the financial sector reforms. Due to unfavorable policy framework. the entire rural credit delivery system is reduced to a moribund state. High transaction costs and poor repayment performance are the twin root causes of the moribund slate of rural credit delivery system. With a view to revive the agricultural credit delivery system, there is need to adopt innovative approaches like linking of Self-Help Groups (SHGs) and Non-Government Organizations (NGOs) with mainstream financial institutions. The revival of rural credit delivery system of Maharashtra also depends on strategies that are required for tackling issues such as sustainability and viability, operational efficiency, recovery performance, small farmer coverage and balanced sectoral development of the state.
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  • Rural Credit Delivery System in Maharashtra: Some Emerging Issues

Abstract Views: 59  |  PDF Views: 1

Authors

Deepak Shah
Gokhale Institute of Politics and Economics (Deemed University), Deccan Gymkhana, Pune- 411 004 (Maharashtra), India

Abstract


An investigation into rural credit delivery system in Maharashtra shows slower growth in institutional finances through commercial banks, credit cooperatives, RRBs and LDBs, particularly during the decade of 1991-2000, which is mainly due to adverse environment created by the financial sector reforms. Due to unfavorable policy framework. the entire rural credit delivery system is reduced to a moribund state. High transaction costs and poor repayment performance are the twin root causes of the moribund slate of rural credit delivery system. With a view to revive the agricultural credit delivery system, there is need to adopt innovative approaches like linking of Self-Help Groups (SHGs) and Non-Government Organizations (NGOs) with mainstream financial institutions. The revival of rural credit delivery system of Maharashtra also depends on strategies that are required for tackling issues such as sustainability and viability, operational efficiency, recovery performance, small farmer coverage and balanced sectoral development of the state.


DOI: https://doi.org/10.21648/arthavij%2F2005%2Fv47%2Fi1-2%2F115764