Q.Explain the institutional sources of agricultural finance in India.

Institutional credit was built up deliberately to reduce farmers' dependence on costlier non-institutional lenders. …

Co-operative credit institutions: Primary Agricultural Credit Societies (PACS) at the village level, financed and supervised through District Central Co-operative Banks and State Co-operative Banks — historically the first organised institutional channel for rural credit in India.

Commercial banks: Brought into agricultural lending on a large scale after bank nationalisation in 1969; today they lend for both short-term crop needs and long-term investment, and issue Kisan Credit Cards giving farmers a revolving line of credit for crop and allied expenses.

Regional Rural Banks (RRBs): Established from 1975 specifically to extend low-cost credit to small and marginal farmers, agricultural labourers and rural artisans, combining local knowledge with a formal banking structure. …

NABARD is sometimes wrongly described as a bank that lends directly to farmers — its primary role is as an apex/refinancing and coordinating institution for other agricultural credit agencies (co-op …