With IFC’s (International Finance Corporation) support, the state cooperative bank will design new credit and non-credit products, including loans, savings, insurance, remittances and other offerings for farmers in Andhra Pradesh. IFC will assist the bank in developing a system of robust risk management to promote responsible finance and check for over-indebtedness among farmers, leading to stronger business operations. The project will also include training for bank staff and member institutions of the bank, according to a press note issued by IFC.
It is vital to develop a programme that addresses the financing challenges of farmers in an agri-dominant state,” said Kasu Venkata Krishna Reddy, minister for cooperation in the state. “This will help us meet the credit needs of the farmers to help accelerate agricultural growth in the country.”
The cooperative bank comprises 4.3 million small and marginal farmers, whom it serves through a network of district cooperative central banks and primary agricultural cooperative credit societies. The bank will also develop financial products for women entrepreneurs in the state.
“Credit products offered under the mandated priority sector lending tend to be mostly basic crop loans, which do not meet the full financing needs of farmers,” said Y Vijayender Reddy, president, Andhra Pradesh State Cooperative Bank. “This project will help us to expand the product and client base substantially, and also strengthen the portfolio quality with better risk assessment.”
