Economic Empowerment Through Rural Credit System by Commercial Banks in India: An Analysis

Commercial banks in India are playing a pivotal role in providing agricultural credit to the rural farmers. It helps in generating income to the poor farmers and increase the agricultural production and helps for rural development t the macro level. This paper has been structured in a systematics way such as introduction, literature analysis, objectives of the study, purpose of the study, research, methodology, data analysis, major findings and conclusions. The development of agrarian in the country enhances the per capita income of the rural population. In this context, the role of commercial bank is highly significant in providing the loan to poor farmers. This study is descriptive and analytical in nature and the study based on the published data sources such as RBI, NABARD and All India Rural Financial Inclusion Survey Data. The collected data has been figured out in the analysis section and interpreted to draw the findings. The data sourced from NABARD, 2009 depicts the consistent share of RRBs in providing agricultural loans. In the year 2002–03, 30.02% of agricultural loans has been issued by the RRBs as against 69.98% of loans offered by the commercial banks. The various short-term loans for agriculture, the credit amount was vibrantly enhanced from 4834 crores in 2002–03 to 22,851 crores in the year 2008–09. There was an increase of fivefold in the farm credit in 8 years of time. It is also very evident that the average amount of agricultural loan disbursement by the commercial banks are had a significant growth over a period of time. During the year 2017–18, the average amount was Rs. 70,009 crores which was the highest share of total credit given by all the financial agencies. It has been further increased to Rs. 88,191 crores in the year 2018–19. The number has consistently increased to Rs. 98,010 crores of disbursement during 2019–2020. On the whole, the economic empowerment of the rural people has been achieved through the commercial bank credit and its consistent increase in the share of credit disbursements.