Banks struggle with farm loan target due to waivers, may lean on PSL certs

But they may achieve overall priority sector lending norms, as corporate loan growth has been slow

With agriculture lending growth remaining muted, banks are struggling to meet year-end targets in this department. So far this year, growth of farm loans by banks has remained flat at 0.6 per cent, compared with 3.2 per cent last year. 

Banks are facing a peculiar sitution in which, on the one hand, the loan outstanding in their books has come down after a series of debt-waiver schemes, while on the other, fresh loan approval has been slow on the back of higher delinquencies. 

Under the latest debt-waiver scheme announced by Rajasthan chief minister Vasundhara Raje this month, the government has