Guidelines for 2 lakh Crop Loan Waiver in Telangana

Telangana Government’s Crop Loan Waiver Scheme 2024: Comprehensive Guidelines

Introduction

The Telangana Government has always been committed to ensuring the stability and profitability of agriculture, recognizing it as a crucial pillar of the state’s economic growth. With 66% of the rural population dependent on agriculture and allied sectors, which contribute 15.8% to the Gross State Domestic Product (GSDP) according to DES data (2023-2024 AE), the development of this sector is imperative for the rural economy. In light of this, the Telangana Government has launched the Crop Loan Waiver Scheme 2024 to alleviate the financial burden on farmers.

Key Objectives of the Crop Loan Waiver Scheme

Alleviating Financial Strain on Farmers

The primary objective of the Crop Loan Waiver Scheme 2024 is to reduce the financial burden on farmers, enabling them to obtain new loans at lower interest rates from banks and avoid high-interest loans from external sources. This scheme will help farmers purchase essential agricultural inputs and protect them from the crippling effects of perpetual debt exacerbated by high-interest rates. By addressing the financial issues faced by farmers, the Telangana Government aims to ensure the stability of agricultural activities in the state.

Eligibility Criteria and Coverage

The scheme applies to short-term crop loans taken by farmers from scheduled commercial banks, regional rural banks, and district cooperative central banks in Telangana. It covers loans sanctioned or renewed on or after December 12, 2018, and outstanding as of December 9, 2023. Each farming family is eligible for a loan waiver of up to INR 2 lakhs, including principal and applicable interest outstanding as of December 9, 2025. The definition of a farming family, based on the Public Distribution System (PDS) database, includes the head of the household, spouse, children, and other dependents.

Implementation Framework

Appointment of Authorities

The Commissioner and Director of Agriculture (DoA) will oversee the implementation of the Crop Loan Waiver Scheme 2024. The National Informatics Centre (NIC) in Hyderabad will serve as the IT partner, collaborating with the DoA to manage an IT portal that facilitates data collection, validation, and eligibility determination for each farming family. The IT portal will also handle bill submission to the Finance Department’s IFMIS portal, share information with stakeholders, and address farmer grievances.

Role of Banks

Each bank will appoint a Nodal Officer (BNO) to coordinate between the bank, the DoA, and NIC. Banks must digitally sign and submit the required data from their Core Banking Solutions (CBS) to the government. For Primary Agricultural Cooperative Societies (PACS), the associated bank branch will handle the data submission. The purpose of this process is to prevent incorrect inclusions and exclusions, with the DoA and NIC conducting data validation checks as needed.

Direct Benefit Transfer (DBT) Mechanism

Eligible loan waiver amounts will be credited directly to farmers’ loan accounts via the DBT system. In the case of PACS, the amount will be transferred to the District Cooperative Central Bank (DCCB) or the bank branch, which will then credit the farmers’ accounts in PACS. The loan waiver will be applied incrementally based on the outstanding loan amount as of December 9, 2023, up to a maximum of INR 2 lakhs per farming family.

Exclusions and Special Provisions

Loans Not Covered

The Crop Loan Waiver Scheme 2024 does not apply to loans taken by Self-Help Groups (SHGs), Joint Liability Groups (JLGs), Rythu Mitra Groups (RMGs), or Large Scale Irrigation Cooperatives (LEICs). Additionally, it excludes restructured or rescheduled loans and crop loans provided to companies or firms, except those availed through PACS.

Audit and Monitoring

To ensure the authenticity of loan account data, the Director of Cooperative Societies and the Registrar of Cooperative Societies will conduct a pre-audit of sample data from Primary Agricultural Cooperative Societies (PACS) and submit findings to the implementing authority (DoA). The government reserves the right to audit each bank account benefiting from the scheme as per RBI/NABARD guidelines through statutory or special auditors.

Grievance Redressal and Supervision

The Commissioner of Agriculture will establish a grievance redressal unit to address farmers’ queries and resolve issues related to the scheme. Farmers can submit their grievances through the IT portal or at the mandal-level help centers. Every application must be resolved within 50 days, and the outcome communicated to the applicant.

Conclusion

The Crop Loan Waiver Scheme 2024 represents a significant step by the Telangana Government to support its farmers and strengthen the rural economy. By alleviating the financial burden on farmers, the scheme aims to ensure the sustainability and profitability of agriculture in the state, ultimately contributing to Telangana’s economic growth.