The Hindu Business Line : Interest rates slashed on non-agri co-op loans

The Tamil Nadu Government has slashed interest rates on non-agriculture loans from cooperative banks to 12 per cent from 18 per cent, according to an official press release.

Penal interest has also been cut to 1.5 per cent from 3 per cent with effect from Wednesday.

The cut in interest rates will benefit all borrowers in the cooperative sector from the Primary Agriculture Cooperative Banks to the Tamil Nadu State Apex Cooperative Bank.

Also, with effect from Wednesday (December 27, 2006) — the date of the order — penal interest has been waived for borrowers defaulting on instalment payments from March 31, 2001, and interest rate has been fixed at 12 per cent. The amount collected by the banks at the lower interest rates will be adjusted towards the defaulted instalment payments, according to the release.

Borrowers should pay 25 per cent of their dues before March 31, 2007, and enter into an agreement with the bank. The balance should be paid before June 30, the release said.

This announcement will benefit over 4.53 lakh borrowers of non-agriculture loans from cooperative banks.

The State Government had earlier written off agriculture loans of over Rs 7,000 crore as on March 31, 2006.

More Stories on : Interest Rates | Financial Policy | Co-operatives | Tamil Nadu

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