SBI To Facilitate Distribution of Rs 40 Crore to Farmers for Paddy Procurement

In a significant development aimed at supporting the agricultural community, the State Bank of India (SBI) will disburse a sum of Rs 40 crore to farmers as the procurement price of paddy. The much-awaited payout was initiated recently, following the submission of essential documents, including the Paddy Receipt Sheet (PRS), by the diligent farming community.

In an extraordinary move to expedite the process, SBI branches across the region worked diligently even on a Sunday to process the necessary paperwork, ensuring that farmers receive their dues promptly.

This recent distribution comes on the heels of SBI's earlier disbursement of Rs 57.32 crore to 486 farmers and Canara Bank's distribution of Rs 15 crore to 2,830 farmers, underlining the concerted efforts by financial institutions to address the pressing needs of the farming sector.

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The impetus for this financial infusion can be traced back to a memorandum of understanding (MoU) inked between Supplyco and a consortium of banks, allowing for the borrowing of Rs 240 crore. The funds were procured to settle outstanding dues pertaining to paddy procurement for the 2022-23 season before the festive occasion of Onam.

The initial disbursement of funds by banks commenced on August 24. However, Supplyco voiced concerns that the financial institutions had not been able to complete the distribution to all farmers before the Onam festival, leading to allegations by G R Anil, Minister for Food and Civil Supplies, who claimed that the banks had faltered in this regard.

Supplyco's decision to enter into the MoU with the consortium of banks was driven by a delay in receiving the Central allocation, which was crucial for expeditiously delivering funds to the farmers. The release of these funds by the Central Government is contingent upon the State providing comprehensive details of expenses related to paddy transport to the mills, conversion into rice through de-hulling, and distribution through ration shops, a process that typically spans four to six months. Importantly, the State's share of Rs 7.92 per kilogram, earmarked as an incentive bonus and handling charges, was already disbursed to the farmers.

It's worth noting that the Paddy Receipt Sheet (PRS) issued by Supplyco plays a pivotal role in this process. These PRS loans, equivalent to the Central Government's support price of Rs 20.40 per kilogram, are provided to farmers based on their PRS. While the State Government assumes responsibility for paying the interest on these loans, any lapse in timely interest and principal payments can impact the credit scores of the farmers. These loans have a one-year term limit.

The timely distribution of Rs 40 crore by the SBI and other financial institutions marks a significant step in supporting the farming community during these crucial times, ensuring that their hard work and dedication are adequately rewarded. As the agricultural sector continues to face challenges, such initiatives remain essential in safeguarding the livelihoods of our farmers and promoting agricultural sustainability.

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