A Micro-Level Study on Credit Utilisation and Repayment Behaviour of Farmers in Thanjavur, Tamil Nadu, India.

Agricultural credit plays a vital role in enhancing farm productivity, ensuring food security,and supporting rural livelihoods. This study examines the utilisation and repayment behaviour of institutional agricultural credit in Thanjavur district of Tamil Nadu. Primary data from 120 farmers were collected using structured interviews. Descriptive and inferential analyses, including principal component analysis and regression, were employed. Results show that 75 per cent of farmers used credit for productive purposes, while 25 per cent diverted funds due to weather shocks, social pressures, and delayed disbursement. Only 25 per cent fully repaid loans, whereas 50 per cent defaulted. Factor analysis identified five key dimensions influencing non-repayment: agricultural risks, personal and financial constraints, operational challenges, financial instability, and market or technological barriers. Regression confirmed all five factors significantly affected repayment behaviour. The study recommends timely credit delivery, flexible repayment schedules, weather-based insurance, crop diversification, and improved financial literacy to enhance credit effectiveness.