Reserve Bank Governor D Subbarao on Thursday said it was possible that subsidised agricultural credit is being diverted for other purposes and suggested modification of the scheme.
“This evidently defeats the objective of the subvention scheme and needs to be corrected either by remodelling the subvention scheme or through tighter monitoring of the end use of agricultural loans”, he said.
Subbarao said he observed the trend during his recent visits to some bank branches in different parts of the country.
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