STUDY ON AGRICULTURE FINANCE PROVIDED BY SCBs IN INDIA
Agriculture finance is one of the important inputs which is being used to support agricultural production. India depends on millions of small farmers for agriculture goods. The commercial banks form the core of the banking system and it comprises of scheduled and non – scheduled banks. This study focuses on the credit flow of Scheduled Commercial Banks’ (SCBs) to the agriculture sector, from 2010-2011 to 2019-2020, which has been increasing for the past few decades. The secondary data is compiled from various published sources and growth of loans and advances has been analyzed by using the compound growth rate technique. The agriculture sector is an important component of the Indian economy as it provides livelihood to a large section of the population. The contribution of agriculture has gone down from 52 percent in 1950 to 30 percent in 1990 and 20 percent in 2010. During 2010-11 to 2019-2020 the share of agriculture and allied activities was 14.4 percent. Initially, the Scheduled Commercial Banks played a marginal role in providing agriculture assistance. After nationalization of commercial banks in 1969 the banks began to provide direct as well as indirect agricultural credit for short and medium-term period. The major sources of finance for agriculture through SCBs are from direct finance and indirect finance. The period of study is taken from the year 2010-11 to 2019-20. From various published reports it was identified that the SCBs provide highest credit to farmers compared to other institution and hence the study is restricted only to scheduled commercial banks and the data is collected accordingly. From the study it is also identified that during the study period from 2010-2011 to 2019-2020 the agriculture credit was increasing at a faster rate from 2014-2015 to 2019-2020.
Keywords: SCBs, Direct Finance, Indirect Finance