Economic feasibility of pumpset loans in Trichur district

Abstract

A study on economic feasibility and repayment capacity of pumpset loans was done using the data generated through microlevel investigation of 98 beneficiaries of the scheme in Trichur district. Analysis revealed that even though the loans passed the test of repayment capacity in all the size groups, they failed to satisfy the criterion of economic feasibility in the lowest size group, even when the period of the loans was extended to fifteen years. This showed that overdues was not a problem, not because of the income generation capacity of the loans, but because the farmers had enough family income with which they repaid the loans.