Non-performing assets in the agriculture sector have dropped significantly from double digits to single digits, according to NABARD Chairman Shaji Krishnan V. Speaking at the Global Fintech Fest, Krishnan highlighted that agriculture sector NPAs were in double digits at one point in time, which have come down to single digits now. He emphasized that boosting crop productivity and enhancing credit facilities will drive further improvements, as reported by IANS. The Chairman noted that farmers' paying capacity will increase with productivity gains, creating a stronger foundation for the sector's financial health.
The National Bank for Agriculture and Rural Development (NABARD) is developing artificial intelligence (AI) models around on-demand Kisan Credit loans as India's rural finance ecosystem increasingly embraces digital lending, according to Chairman Shaji Krishnan V. Speaking on Thursday, Krishnan emphasized that digitalisation is gaining traction across agriculture and allied sectors, including fisheries and dairy, creating new opportunities to improve credit delivery and financial inclusion in rural India. The AI-led approach aims to strengthen digital rural lending, timely credit access and financial inclusion while helping address persistent agricultural financing gaps. As per IANS, NABARD is integrating AI technology to enhance Kisan Credit loan processes, promoting digital lending in India's rural finance sector.
According to Krishnan, the government's efforts in creating foundational digital infrastructure have laid the groundwork for bridging the rural urban divide. He noted that nearly 45 per cent of India's population lives in rural areas, making inclusive growth critical for the country's development. The Chairman highlighted the importance of linking identity frameworks such as Aadhaar with economic activity to build a stronger digital rural finance ecosystem. He said the next step is to better link identity frameworks such as Aadhaar with economic activity, with the creation of Agri Stack necessitating an additional financing layer to ensure financial products are available at the right time and place.
Krishnan explained that Agri Stack is being developed as a three-layer foundational framework, consisting of an identification layer (Aadhaar), a land layer, and an agriculture activity layer. NABARD has implemented a loan origination system that integrates both Agri Stack and India Stack, allowing for on-demand Kisan Credit Card loans for about 7.5 crore farmers. This integrated approach enables faster and more efficient credit delivery while building a comprehensive digital foundation for the agricultural sector.
Pointing out that the growth in the agriculture sector is around 3.5 per cent, Krishnan said that to become Viksit Bharat, this has to be accelerated. Speaking at the Global Fintech Fest, he emphasized that every section of society needs to grow for Viksit Bharat to succeed, otherwise there will be some sort of divide. The Chairman noted that to become Viksit Bharat, the ambition of the government of India, every section of the society needs to grow. This growth acceleration requires continued focus on productivity enhancement, credit enhancement, and insurance to further improve the sector's financial health.
