IBA opposes farm loan waiver package
Hyderabad: Indian Banks' Association (IBA) opposed the farm loan-waiver schemes announced by the Andhra Pradesh and Telangana governments expressing fear that the move would create "ill will" in the community.
IBA Chief Executive Officer M V Tanksale said such schemes would dent the financial discipline and opined that instead of providing resources for such schemes, the governments should concentrate on long term development of farming community.
"No banker is absolutely comfortable with the debt waiver schemes. It totally vitiates the payment culture in the industry. And everyone feels that sometime or the other government will come with a waiver and why they should really pay.
"It creates ill will among those who are prompt payers, because debt waiver goes to only those who default the payment," Tanksale, also former Chairman of Central Bank of India, said.
As part of fulfilling poll promises, Andhra Pradesh Chief Minister N Chandrababu Naidu and his Telangana counterpart K Chandrasekhar Rao have initiated a process to implement loan waiver schemes.
News Posted: 17 June, 2014
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