₹1,000 crore credit guarantee scheme for farmers launched

The Centre on Monday unveiled a credit guarantee scheme (CGS) to help small farmers who engage in distress selling.

- JITENDRA CHOUBEY @ New Delhi

Launched by Union Food and Consumer Affairs Minister Prahlad Joshi, the scheme provides a corpus of Rs 1000 crore to help farmers, especially small and marginal, access post-harvest loans using electronic warehouse receipts.

"The scheme will revolutionise agriculture credit systems and reduce banks' reluctance to provide loans to farmers," said Joshi.

Currently, farmers are compelled to sell their produce even if the price crashes to get money to invest in the next cycle of crops.

As this scheme takes off, farmers will get the opportunity to submit their produce and get issued electronic negotiable warehouse receipts (e-NWRs) by Warehousing Development and Regulatory Authority (WDRA) registered repositories.

It will act as collateral for banks to issue required loans.