Chennai, Oct 14 Even after the Tamil Nadu government increased the ceiling for collateral-free crop loans from Rs 1.60 lakh to Rs 2 lakh with effect from January 1, 2025, several cooperative societies across the state are allegedly providing lower amounts to farmers.
Many cultivators have also complained that only those who had borrowed in the previous year are being considered for fresh loans this season, while first-time applicants are being denied.
The revised ceiling allows eligible farmers to avail interest-free crop loans up to Rs 2 lakh through Primary Agricultural Cooperative Banks (PACS), repayable within 12 months. However, farmers’ associations have raised concerns that a number of societies in districts such as Tiruppur and Coimbatore are issuing loans capped below the old limit, forcing many growers to depend on private moneylenders at higher interest rates.
While some cooperative banks are reportedly implementing the revised limit, the distribution remains inconsistent. In certain taluks, farmers have been able to access the full Rs 2 lakh loan amount without any restrictions, whereas in others, applications are being processed selectively.
Complaints have also emerged over the slow pace of loan approvals, with some societies taking over 10 days to process applications that should ideally be cleared within a week. Instead of handling applications individually, several banks are said to be bunching them together for collective processing, delaying disbursals during the peak cultivation season.
Officials in the cooperative department have attributed the variation in loan amounts to differences in crop costs. They said that societies assess the type of crops proposed for cultivation and determine the loan quantum accordingly.
For crops with lower input costs, the sanctioned amount may fall below Rs 2 lakh. Nonetheless, department sources have maintained that all eligible farmers are being covered under the revised scheme.
Farmer groups have urged the cooperative department to intervene and issue clear instructions to ensure that all eligible applicants receive the full revised limit of Rs 2 lakh, regardless of their past borrowing record. They also sought stricter monitoring to ensure that the government’s interest-free crop loan initiative reaches every farmer without bureaucratic hurdles or regional disparities.
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