NEW DELHI : Warehousing Development Regulatory Authority (WDRA) has signed a memorandum of understanding with State Bank of India to help farmers in getting low interest rate loans.
The Memorandum of Understanding (MoU) was signed with the intent of promoting awareness about the new loan product called ‘Produce Marketing Loan’ to exclusively fund against e-NWRs (electronic Negotiable Warehouse Receipt) with features such as nil processing fee, no additional collateral and attractive interest rates, an official statement said.
“It is envisaged that the product will have far reaching consequences with regard to acceptance of e-NWRs among small and marginal farmers. It has the potential to make significant impact on the finances of rural depositors by preventing distress sale and releasing better prices for the produce,” it added.
Combined with the inherent security and negotiability of the e-NWR system, the ‘Produce Marketing Loan’ will go long way in improving rural liquidity and increasing farmers income. The MoU was signed with the State Bank of India (SBI).
In another statement, Food and Consumer Affairs ministry informed that a conference on “Digital financing against e-Negotiable Warehouse Receipts and way forward” was held at NABARD Head Office in Mumbai.
The purpose of the conference was to interact with bankers to increase post-harvest pledge finance against e-NWRs issued by warehouses registered by WDRA and evolve mechanisms that would improve ease of doing business.
This would also help raise the post-harvest pledge financing from current levels.
Bankers present expressed their satisfaction with the e-NWR system established by WDRA as it provides them with considerable safety and comfort against loans advanced by them against warehouse receipts.
Loaning against e-NWRs has shown a steady growth over the years. During FY 2022-23, the loan figure has already crossed Rs 1,500 crore.
WDRA, as the regulator of the warehousing sector and the agency for establishing the Negotiable Warehouse Receipts (NWRs) in the country, assured the bankers present that it would extend all support to bankers to ensure safety of loans made against electronic NWRs.