A COMPARITIVE STUDY ON CHALLENGES FACED BY THE FARMERS TOWARDS AGRICULTURAL LOANS FROM COMMERCIAL AND CO-OPERATIVE BANKS WITH REFERENCE TO PALAKKAD DISTRICT, KERALA.

Abstract

This study has looked into farmers' borrowing preferences between commercial and cooperative banks. For the Indian agricultural sector, agriculture finance is still an evolving tactic. The current study has concentrated on the difficulties Palakkad district farmers face when applying for loans and the potential outcomes from commercial and cooperative banks. It demonstrates the growing tendency of the farming community's institutional credit requirements. The three-stage, non-probability sampling strategy with stratification was used. The first stage was selection of strata i.e. the area Palakkad was selected. In the second stage, based on production level five villages in Palakkad namely Nallepilly, Kozhinjampara, Chittur, Elapully and Polpully were selected. In the third stage based on simple random sampling about 120 respondents were selected. From each village, about 25 farmers—marginal, small, medium, and large were chosen. Chi-square, ranking, and the percentage approach are the statistical methods applied in the analysis. According to the report, agricultural loans from commercial and cooperative banks have been growing quickly, but they are still insufficient to meet the demands of farmers in Palakkad. As a result, farmers are forced to turn to alternative unofficial loans to cover some of their needs, both productive and unproductive. This study mostly compares commercial and cooperative banks because farmers' access to loans has been limited by their inability to provide collateral, high interest rates, a difficult loan application process, and a lack of knowledge about interest subsidy schemes