CHANGING FACE OF AGRI BANKING

The Banks in India have played a vital role in the development of the country's economy, be it the rural one or the urban one. More specifically, the Indian public sector banks, The Regional Rural Banks and the cooperative banks have been serving the financial needs of the rural population of the country since their very initial days.

- Md Shahid Kabeer

Introduction :

In India, where more than 65% of the population lives in villages. These communities had only experienced banking in the last two to three decades. In the modern age of technology, the rural areas of the country are also not untouched by the adoption of technology. The majority of the farmers have small land holdings; the production of the farms is lower, and the income is lower. To increase the productivity of the farm fields, it is required to adopt modern technology, and that will also cost investment; hence, the importance of the lending institutions became more crucial.

Agriculturist in India 

The Department of Agriculture, Co-operation, and Farmers Welfare conducts an agriculture census every five years to collect data on the structural characteristics of the agricultural sector, including the size of agricultural land holdings in the country. As per the latest information available from the Agriculture Census, the average size of operational holdings has decreased from 2.28 hectares in 1970-71 to 1.84 hectares in 1980-81, to 1.41 hectares in 1995-96, and to 1.08 hectares in 2015-16.

Due to rapid growth in the village population and the emergence of the nuclear family concept, the land holdings of Indian farmers are shrinking gradually.

The above-listed states are considered to be large states where the average land holding is very small, so it is very well understood that the dependency merely on farm income cannot suffice the needs of the families. Therefore, there are two options available to the families: one is migration, which is very common, and another is to evolve modern technology and improve the productivity of the small landholding farmers.

Initiatives of the Government and the Banks to cater the financial needs of the rural areas