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Loan Waiver: Clarification on Scale of Finance rule
By: Tupaki Desk | 9 Dec 2014 1:33 PM GMT
AP CM Chandrababu Naidus prestigious loan waiver scheme turned as big relief to the farmers throughout the state and all are in festive mood after knowing that there loan was waived off. There were even some complaints running on the loan waiver scheme and some farmers reportedly unhappy after knowing that they got only partial waive off due to Scale of finance.
The word SoF creating headaches for the farmers and government officials too and What is this scale of finance? How it will affect the chances of getting 100% loan waiver.
Here is the real story aboutscale of finance.As per the pre-existed rules there is a limit set for agricultural loans per acre, this is called Scale of Finance. This scale of finance will deicdes how much amount can be given to a particular crop and it usually varies from area to area and crop to crop.
While offering the loans bankers didnt considered the scale of finance and offered loans moe than the limit on greedy for the interests. They even not considered the warnings from RBI.Now farmers who received more loan than scale of finance applicable to particular crop or particular area need to pay the excess amount.
For instance if Scale of Finance was 45,000 rs and if the loan offered was 70,000 then Government will waive off only Former amount and the excess amount (25000) has to be paid by farmers. However much to relief for farmers Andhra Pradesh government did not impose this SOF limits on loans less than 50000.People who got loan more than 50,000 comes under SoF rule.
The word SoF creating headaches for the farmers and government officials too and What is this scale of finance? How it will affect the chances of getting 100% loan waiver.
Here is the real story aboutscale of finance.As per the pre-existed rules there is a limit set for agricultural loans per acre, this is called Scale of Finance. This scale of finance will deicdes how much amount can be given to a particular crop and it usually varies from area to area and crop to crop.
While offering the loans bankers didnt considered the scale of finance and offered loans moe than the limit on greedy for the interests. They even not considered the warnings from RBI.Now farmers who received more loan than scale of finance applicable to particular crop or particular area need to pay the excess amount.
For instance if Scale of Finance was 45,000 rs and if the loan offered was 70,000 then Government will waive off only Former amount and the excess amount (25000) has to be paid by farmers. However much to relief for farmers Andhra Pradesh government did not impose this SOF limits on loans less than 50000.People who got loan more than 50,000 comes under SoF rule.
