Farmers To Be Exempted From Mortgage Fee For Bank Loans

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CHANDIGARH – The state has finally got the presidential assent to amend the Punjab Agricultural Credit Operations and Miscellaneous Provisions (Banks) Act, which will allow farmers to mortgage their land with banks without paying the mortgage fee.

The move will help farmers to procure loans in a hassle-free manner. The amendment will also lessen the work load of the Revenue Department. It is estimated that 35 per cent of the department’s work deals with land mortgage registration.

At present, a farmer has to pass through the process of registration of an agreement with the bank for loan and then with the tehsildar and naib tehsildar. The process takes two to three days for a farmer to get his loan agreement registered with the Revenue Department.

Under the amended law, a farmer seeking loan will enter into an agreement with the bank concerned and instead of registering the agreement, revenue officials will be intimated so that an entry regarding the loan can be made in the revenue records.

The amended law will also help the government in weaning away farmers from the clutches of private money lenders and arhtiyas and bringing them into the fold of institutional finance.

Though the government and State Level Bankers Committee (SLBC) for Punjab have been emphasising on swapping of farmers’ debt from money lenders with bank loans, the scheme has not failed to take off. Officials in the Agriculture Department say the amendment was likely to encourage more farmers to go in for bank loans.