RBI cracks whip on farm loans irregularities
Quotes

RBI cracks whip on farm loans irregularities

Last Updated: Thursday, March 07, 2013, 21:05
 
 Comment 0
 
RBI cracks whip on farm loans irregularities
Mumbai: Taking serious note of the CAG report on agricultural debt waiver and debt relief scheme of 2008, the RBI has cracked the whip on all scheduled commercial and local area banks asking for complete details on farm loans, an official has said.

The Comptroller and Auditor General (CAG), in its report tabled in parliament Tuesday on the "Implementation of Agricultural Debt Waiver and Debt Relief Scheme, 2008", said there were irregularities in at least one in five cases.

In a letter to the chiefs of all scheduled commercial and local area banks Wednesday, the Reserve Bank of India (RBI) has sought the beneficiaries' lists with verification with priority to areas where indebtedness was high.

The RBI has also asked for a list of eligible beneficiaries who were not extended benefits, with reasons for such denials, and action to be taken in all cases where malafides or carelessness appears likely, according to an official statement released Wednesday.

Ordering the banks to issue debt waiver and debt relief certificates in all eligible cases immediately, the RBI asked them to keep full records of such issuance ready for the inspection.

It has also said that the banks must identify the administrative and accounting lapses on the part of the bank officials, internal auditors, statutory officials who were responsible for the verification, certification, or for passing the claims.

"Action needs to be initiated and full responsibility be fixed at the earliest with no exceptions," the RBI said in the communication.

The apex bank has also said that cases of extending benefits to ineligible beneficiaries must be dealt with 'on top priority' and full recoveries as per law must be made to ensure no loss to the exchequer.

"It will be the personal responsibility of the institutional heads to ensure that such recoveries are effected in full," the RBI ordered.

Calling for identifying and scrutinizing all cases of tampering of records or alternations, etc, by higher authority, the RBI has sought a decision on each such case in the form of speaking orders.

"Stringent action under relevant sections of law against those responsible must be initiated. This would be monitored by ... the concerned institutions regularly," it added.

The banks have been asked to comply with these issues in a monthly format which the banks are required to furnish by the seventh of each month.

Incidentally, on Jan 14, the RBI had referred to the observations made during an Exit Conference with Comptroller and Auditor General (CAG) officers Dec 7, 2012 with regard to the agricultural debt waiver and debt relief scheme.

These included ineligible accounts of farmers extended benefits under the scheme, and the CAG had noted that to provide benefit to ineligible farmers, instances of tampering and over-writing, inadequate documentation, etc had taken place.

At that time, the RBI had issued a series of guidelines to address the above issues within a stipulated deadline of one month (Feb 14) for compliance.

Prime Minister Manmohan Singh's government had announced a debt waiver for farmers worth around Rs.52,000 crore across the country in 2008, a move analysts say helped the United Progressive Alliance (UPA) government win the 2009 general elections.

IANS



First Published: Thursday, March 07, 2013, 21:05


Comments


comments powered by Disqus
New York Auto Show: 2015 Subaru Outback
New York Auto Show: 2015 Subaru Outback
New York Auto Show: Dodge Hot Cars
New York Auto Show: Dodge Hot Cars
New York Auto Show 2014: Hot Cars
New York Auto Show 2014: Hot Cars
Top 10 Fastest-Emerging Cities
Top 10 Fastest-Emerging Cities
Top Businesswomen in India
Top Businesswomen in India

Web Wrap
Contact Us : Privacy Policy : Legal Disclaimer
Copyright © Zee Media Corporation Ltd. All rights reserved