November 24th, 2011
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State Agricultural Rural Bank increases interest rate

farmers loan interest increasedThiruvananthapuram: State Agricultural Rural Bank increased their interest on agricultural loan by 0.75 percent. The current interest is 12 percent. For loans above Rs 50,000 the interest rate was 13.5 percent. After the current hike in the interest rate the interest rate shall be 14.25 percent.

This decision by banks come at a time when the agricultural sector in Kerala is undergoing a crisis. In the last two weeks more than 13 people committed sucide as they could not take the financial burden. Most farmers who ended their lives did so as they were unable to repay their bank loans. The decision of banks would be resisted by the people.

NABARD had increased its rate five times this year itself. The bank official claimed that as the NABARD bank increased its rates five times the bank had no other alternative but to increase interest rates. Majority of the farmers in Kerala have taken loans from Agricultural Rural banks.

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