Repayment and Overdues Determinants of Agricultural Credit : Some Results for Commercial and Cooperative Banks

The present study attempts to analyze the extent of repayment and overdues and also the causes for overdues at the farm-household level, identify the factors which discriminated the borrowers into non-defaulters and defaulters, and assess the probability of willful and non-willful defaulting. One hundred sample borrowers of commercial and cooperative banks were selected for the present study. To identify the factors which discriminated the borrowers into non-defaulters and defaulters, discriminant analysis was carried out. Logistic regression analysis was applied to find out the probability of the farmers becoming willful and non-willful defaulters. Utilization of credit and non-farm income were the dominant factors in classifying the borrowers into defaulters and non-defaulters. Farm income and consumption expenditure were the significant factors to determine willful defaulting. One unit of increase in the factors such as farm income and consumption expenditure would lead to one unit increase in willful defaulting. The sources of credit availed and interest rate were the significant factors to determine the amount of non-willful defaulting