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UPSC Prelims 2011 · Agriculture · Farm Money
In India, which of the following have the highest share in the disbursement of credit to agriculture and allied activities?
- (a) Commercial Banks
- (b) Cooperative Banks
- (c) Regional Rural Banks
- (d) Microfinance Institutions
Show the answer and explanation
Answer: (a) Commercial Banks
Commercial banks give the largest share of institutional farm credit (~75%+).
Why the others are wrong
(b) Cooperatives were once the leaders but now have a smaller share.
(c) RRBs have a small share.
(d) MFIs are minor in farm credit.
The trap
Cooperatives dominated before bank nationalisation, which makes (b) tempting.
🔒 Farm credit share: commercial banks > cooperatives > RRBs.