NEW DELHI: At a time when the government is going all out to project a "pro-farmer" image, promising a Rs 60,000 crore waiver on farm loans and talking big on boosting agricultural credit, the country's largest state-owned bank, State Bank of India, has decided to stop giving loans for the purchase of tractors and other farm equipment.
In a circular to its branches, the bank has said that because of mounting non-performing assets in the farm equipment loan segment, it has decided to put on hold all future advances for farm equipment like tractors, power tillers and combined harvesters.
SBI chief general manager Shyamal Acharya, who is in charge of the bank's agri-business, confirmed that the bank has temporarily discontinued giving loans to farmers for purchase of equipment and said the decision was forced by the high incidence of nonperforming assets (NPAs) in the segment.
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