Author: Abhiram Ghadyalpatil
Publication: Livemint.com
Date: September 26, 2017
URL:   http://www.livemint.com/Politics/oxZBATIH53z7sXY0CDLadI/Farm-loan-waiver-Maharashtra-detects-15-million-suspicious.html?facet=amp&utm_source=googleamp&utm_medium=referral&utm_campaign=googleamp

According to a senior BJP minister, a preliminary probe by the Maharashtra government identified these ‘bank accounts without a credible credit history’

The Maharashtra government has spotted nearly 1.5 million suspicious bank accounts it suspects were created merely to grab the benefits of its Rs34,022 crore farm loan waiver.

According to a senior Bharatiya Janata Party (BJP) minister who is also a member of the ministerial group on farm loan waiver, a preliminary probe by the state cooperation department identified these “accounts without a credible credit history”.

“The people who have opened these accounts have been identified using their Aadhaar number and biometric information. Since most of these accounts have been opened in the last six to eight months, they do not show a long credit history that a typical farmer’s account would have. We are investigating these accounts further,” said the minister, requesting anonymity.

The cooperation department, which is implementing the farm loan waiver, has asked the state level bankers’ committee (SLBC) to investigate these accounts.

Earlier this month, senior BJP leader and revenue and PWD minister Chandrakant Patil triggered a controversy when he said the government had discovered 1 million bogus farmers among those who had applied online for the loan waiver. The minister quoted above said what Patil meant was “there are bogus accounts that have been opened by proxy farmers with the intention to take benefit of loan waiver”.

Under the online application system based on a similar digital platform that the Andhra Pradesh government used to identify deserving beneficiaries for the loan waiver, eligible farmers in Maharashtra have to fill up a two-page form at one of the 26,000 facilitation centres across the state.

Farmers must give details such as their Aadhaar number, numbers of all bank accounts held by them or family members, size of outstanding loan, land holding and crops. The government believes this system would help it build a database of farmers with authenticated biometric information that tallies with their Aadhaar numbers and bank accounts.

The BJP-led government announced the farm loan waiver on 24 June.

It launched the online application system a month later. The initial deadline to submit online forms was 15 September, which has now been extended to 22 September.

By the 22 September deadline over 10 million farmers had enrolled for the farm loan waiver of which 5.6 million farmers had completed their online application process, according to Subhash Deshmukh. The “suspicious” 1.5 million accounts the government has focused on are part of this enrolment.

“The discovery of such accounts proves the very purpose of this system to identify genuine farmers and segregate them from the fake ones. That is what the government meant when it announced that each and every online application will be scrutinized to prevent fake farmers from taking away the benefit,” said a senior information technology department official who is part of the government team implementing the system and who did not want to be named.

A cooperation department official, who requested anonymity, said a majority of these accounts have been opened with the district central cooperative banks (DCCBs).

“The DCCB is the most accessible formal lending institution in rural areas. Also, the people who have opened these accounts showing themselves as farmers must have completed the KYC (know your customer) formality which only requires them to give their proof of identity and address. The Aadhaar card suffices for this purpose,” said the official.

The official said these accounts were opened around the time when pressure started building on the state government to announce a loan waiver. “The farm loan waiver was being demanded at least for six to eight months before June this year when it was actually announced. By April, it had become evident that the state was being pushed towards the loan waiver and these accounts were opened in anticipation of the sop,” the official said.