Govt strengthens cooperative credit system to reduce NPAs

Anantapur: In a major step to strengthen rural cooperative societies and curb Non-Performing Assets (NPAs), the State Government has initiated reforms to improve financial discipline and ensure timely loan recovery.

Under the new guidelines, cooperative and primary agricultural credit societies have been directed to identify NPAs defined as loans overdue for more than 90 days and implement corrective measures.

Societies with better repayment performance will receive enhanced financial assistance and incentives.

To encourage better financial management, the government has introduced a grading system (A, B, C, D) based on loan recovery rates. Villages with over 90% recovery will be classified under Grade A, with incentives ranging from ₹45 lakh to ₹100 lakh depending on their performance.

Similarly, cooperative societies at the mandal level with 75% or more recovery will be eligible for increased funding from ₹20 lakh to ₹35 lakh under the NPA reduction scheme.

The initiative also includes village-level monitoring units to guide societies in maintaining loan discipline. NABARD and DRDA officials will conduct periodic reviews to ensure effective implementation.

As part of the “Clean Credit-Strong Village Economy” campaign, 1,323 cooperative societies across 31 mandals in Anantapur district will benefit from this scheme, covering over 3.5 lakh members.

Officials stated that these measures will not only reduce NPAs but also strengthen the rural credit structure, empowering farmers and small entrepreneurs.