A Study on Utilisation of Credit by Marginal Farmers in Nadia District of West Bengal

Abstract

The study has been conducted in Nadia district of West Bengal. Two villages have been purposively selected for the study. Out of 50 marginal farmers 17 (34% of the total) have reported to have taken loan from various sources like nationalised banks, moneylenders and churches. The marginal farmers have been grouped into three on the basis of level of annual income. Tabular method of analysis has been extensively employed in this study. Simple correlation analysis has been exercised between use of credit in productive purpose and each of the variables like size of operational holding, income from off farm sources, gross cropped area under non-cereal crops, per capita income and number of crops grown. No significant correlation has been found in any case. The study also reveals that the highest percentage of the borrowing households exist in medium income group. As a whole percentage of borrowing marginal agricultural households (farm) taking loan from non-institutional sources is considerably higher than the percentage of households taking loan from institutional sources. Nationalised banks are the only institutional source of credit. No wide difference has been found in the amount of loan taking from institutional and non-institutional sources. No agricultural household in high income group has taken loan from non-institutional sources. Amount of credit per household is the largest in high income group and smallest in low income group. In low and high income groups of borrowing marginal households, amounts of loan in productive purposes are higher than those used in non-productive purposes. But use of higher amount of loan has been recorded for non-productive purposes in medium income group. Irrespective of income groups amount of loan used in non-productive purposes has been recorded to be higher than in productive purposes. Concerned to the productive activities, loan has been used only in crop production across all the income groups of borrowing agricultural households. In case of non-productive activities majority of loan has been used in building houses. The other uses of loan in non-productive purposes are related to ceremony, consumption and health.