Previous Year Question

Commercial Banks have held the largest share in providing Institutional Credit to agriculture and allied sectors in India. These banks provide short-term, medium-term, and long-term loans for crop production, agricultural equipment, irrigation, animal husbandry, dairy farming, and other agricultural activities.

Agricultural credit disbursement in 2009–10:

These figures are based on the Ministry of Finance's statement presented in the Rajya Sabha on 17 August 2010. Commercial Banks accounted for approximately 75% of the total.

Cooperative Banks primarily provide loans to their members in rural and agricultural areas. The short-term cooperative credit structure includes State Cooperative Banks (SCBs), District Central Cooperative Banks (DCCBs), and Primary Agricultural Credit Societies (PACS).

Regional Rural Banks (RRBs) were established in 1975 to expand banking services in rural areas. They primarily provide credit to small and marginal farmers, agricultural labourers, rural artisans, and small entrepreneurs.

The expansion of agricultural credit through Commercial Banks, Cooperative Banks, and Regional Rural Banks has played an important role in increasing rural Financial Inclusion and agricultural investment. The National Bank for Agriculture and Rural Development (NABARD), established on 12 July 1982, performs refinancing, developmental, and supervisory functions in the agricultural and rural credit system.