Credit Debt and Over-indebtedness Among the Agrarian Community: A Case Study in Krishnagar-I C.D. Block of Nadia District, West Bengal

Abstract

This article examines the different aspects and the persistence of credit debt and over-indebtedness among the 227 rural agrarian households of seven representative villages in Krishnagar-ICD Block of Nadia district, West Bengal in India. This study employed three multiple regression models, one binary logistic regression model, percentage and frequency count to analyse the data. Overall, 41.41% of the total farmers faced an over-indebted burden. The majority of the borrowers are sub-marginal farmers (59.47%), availed their major proportion of credit (63.17%) from different non-institutional agencies and utilized their major proportion loan (69.37%) for several unproductive purposes. Over-indebtedness is strongly related to the farmer from a lower age group and experiencing the adverse shock of death from any family member. It is found higher among the more experienced farmer and the farmer having more percentage of cash crop and with the increase of overdue amount and credit demand per acre. On the other hand, it is found lower with the rise of per acre cost for production. To reduce the uncertain shock of the over-indebtedness burden, credit literacy, land productivity and non-agricultural income source should be increased, complicated procedural formalities of formal credit for the sub-marginal farmer and landless sharecropper should be minimized.