Farmers holding Class 2 land can take loan against it from banks Minister

Mumbai, Mar 26 (PTI) The Maharashtra revenue department has re-issued an old circular stating that farmers holding Class 2 land can mortgage it to avail loan from banks, a state minister said on Wednesday.
In a statement, Revenue Minister Chandrashekhar Bawankule said, "Farmers owning Class 2 land often faced difficulties in availing loans due to restrictions on mortgaging such lands. The revenue department has now issued a fresh memorandum, allowing banks to accept these lands as mortgage."
The decision was made after officials of the Satara District Central Co-operative Bank raised the issue during a meeting on March 11, he said.
"This decision will now come into effect across the state, allowing all farmers holding Class 2 land to mortgage it for loans," Bawankule said.
The minister noted that a similar circular was issued in 1990, and the department has now re-issued it as a reminder to address ongoing concerns.
"District central banks and nationalised banks will now be able to accept Class 2 land as collateral," he said.
Earlier, banks used to hesitate in offering loan against such a land as in case of loan default, they could not enforce the mortgage due to legal limitations on Class 2 land. As a result, many farmers were denied credit, Bawankule said.
The reminder circular has been sent to all divisional commissioners and district collectors to ensure uniform implementation, he added.

(This story has not been edited by THE WEEK and is auto-generated from PTI)