Holding big defaulters responsible for higher NPAs of banks, Finance Minister Arun Jaitley today said that recovery of money from these "big people" has become a "big challenge".
Jaitley was in city to attend the centenary completion celebrations of Pune District Central Co-operative Bank (PDCC). NCP chief Sharad Pawar is associated with this bank for last 50 years.
"Wherever small borrowers are taking loans from banks, there is lesser NPA. NPA is low where smaller amount of loans taken for agricultural and smaller businesses and even in MUDRA scheme, the NPAs are at miniscule scale.
"Whatever big NPAs are there in the big banks, that are not because of small people, but because of big people (defaulters) and today it has become a challenge how to recover that money from these people," said Jaitley.
His statement came after NCP chief, who has been associated with the bank for last 50 years, mentioned in his speech that PDCC has zero per cent NPA.
The finance minister added that when these big loans were given to these defaulters, the thinking then might have been different.
The Finance Minister added that bank plays an important role in the growth of the country as it offers loans to businesses, farming and students for education purpose, but if the banks's capacity to offer the loans gets affected because some big people are sitting on the loans, the growth, not only of rural sector, but of the entire country gets affected.
"For the first time, government is taking steps to take these big people to insolvency so that the recovery can be done and that money can be utilised for the growth of the rural sector," he said.
Jaitley lauded the efforts of PDCC and its administrators and members for sustained good performance of the bank and said that the model of PDCC should be replicated in other parts of the country.
He praised Pawar for his contribution in the farming sector and also said that he rises above the party politics and gives his inputs to the government, when it comes to national interest.
Pawar, in his speech, spoke about the success of PDCC bank for last 100 years and said it is one of the few banking institutions in the country which has zero per cent NPA.
"For all these years, the bank is providing loans for agriculture, dairy businesses and taught the borrowers to repay the loans.
"When commercial and nationalised banks turned their backs on the farmers when they were in problem, it is the cooperative banks like PDCC that have helped these farmers," he said.
Maharashtra Chief Minister Devendra Fadnavis in his speech said that the state government is scrutinising applications of farmers for farm loan waiver and by October, the government will start crediting the amount in the farmers' account.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.