Long-term credit must: coop banks

The cooperative banking sector has assailed the finance ministry's proposed move to keep the long-term credit structure out of the purview of the revival package mooted by the Vaidyanathan task force.

This package is sought to be offered only to the cooperative institutions engaged in lending short-term loans. In a statement issued today, the National Federation of the Cooperative Agriculture and Rural Development Banks has described the finance ministry's decision as arbitrary and unfair.

Besides, it marked a deviation from the government's earlier policies and recommendations of various other committees. The long-term cooperative credit structure normally offered loans for capital formation.

The short-term credit structure that is proposed to be rehabilitated with the new package offers credit for crop production and seasonal agricultural operations.