Credit Utilization Pattern in Cotton Cultivation

Considering more need of credit in cotton cultivation than other traditional crops, this paper has looked into the credit utilization pattern of cotton farmers by selecting Nagpur district as study area and conducting multiple regression analysis to determine the factors that affect barrowing a loan. The study has revealed that all socioeconomic variables had a positive relation with the amount of loan borrowed, whereas the education level had a negative relation. The study has found that about 22 per cent of farmers utilize credit for unproductive purposes. The average time taken by the farmers to repay the loan was 9.82 months. The debt burden was recorded highest in small farmers, ( 8607), followed by medium farmers ( 3017) and large farmers ( 1852). The overall farmers had a debt burden of 5823. In availing the credit, non-availability of loan at proper time was the major problem reported, followed by, long time in taking a loan from banks and lack of knowledge about loan application.