Borrowing and Repayment Hardships: Evidences from Farmers in Haryana

The paper focuses on the problems faced by farmers in obtaining and repaying loans from institutional and non-institutional sources. The study was conducted in Haryana state, India. It was based on a field survey involving 600 farmers. Proportionate sampling technique was employed and pre-tested schedules were filled during vis-a-vis interviews. T he f indings o f t he s tudy h ighlight m ain p roblems f aced b y f armers i n a cquiring a nd repaying loans. They include: no loan without security, ambiguous terms and conditions, the time-consuming procedure of granting loans, not farmer friendly bank officials, and the request for bribes. In the case of non-institutional sources, main problems include: lack of security, deterioration of social status, and hesitation in mortgaging agricultural land. Furthermore, low price of agricultural produce, crop failure, and the high-interest rates charged by non-institutional sources were major constraints in the timely repayment of loan amounts. Several constraints existed in granting loans to farmers. Government should support and provide hassle free loans to farmers.