Farmers, ex-servicemen, rural people worst hit
Nishikant Khajuria
JAMMU, Sept 18: A severe financial crisis has engulfed the lives of thousands of innocent depositors who invested their hard-earned savings in the Jammu and Kashmir State Cooperative Agriculture and Rural Development (SCARD) Bank.
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Despite Fixed Deposits (FDs) and Recurring Deposits (RDs) worth crores of rupees maturing since April 2025, the bank has failed to return the deposits to the investors, leaving them in a state of financial distress.
The affected depositors, mostly farmers, ex-servicemen, and poor rural people, are struggling to access their own savings. With 24 branches across Jammu Division and nearly 12,000-15,000 depositors, the situation has become alarming.
The inability to retrieve their deposits has had a devastating impact on the lives of these individuals, who are unable to arrange family functions, marriages, pay medical bills, fund children’s education and rebuild homes damaged in recent floods.
The desperation has reached such extremes that a few depositors, out of sheer frustration and hopelessness, have even attempted to take extreme steps with their lives – a grim reflection of the depth of this crisis.
Pertinent to mention that the Jammu and Kashmir State Cooperative Agriculture and Rural Development Bank Ltd (JK SCARD Bank) was established on October 4, 1962, under the provisions of the Jammu and Kashmir Cooperative Societies Act, 1960. Initially, it was known as the Central Land Development Bank, with the primary objective of providing loans to farmers for land development, redemption, and other agricultural purposes. Having symbiotic relationship with NABARD (National Bank for Agriculture and Rural Development), the bank was providing long-term and medium-term credit to farmers for agricultural and non-agricultural activities, offering loans for farm mechanization, dairy development, horticulture, minor irrigation and other allied activities, promoting financial inclusion and socio-economic development in rural areas.
Later, the JK SCARD Bank submitted a proposal for amendment in the Jammu and Kashmir Cooperative Societies Act, 1989, to incorporate diversification of lending activities and permission for the same was granted following which the bank started accepting deposits in the form of Fixed Deposits and Recurring Deposits.
According to the sources, present situation is that the SCARD Bank has turned bankrupt, with most of the deposited funds eroded due to wrong investments. The liabilities have exceeded the funds, leaving a total liability of around Rs 165 crores for Jammu division. Approximately 80 percent of the depositors belong to Jammu division, who have been left in the lurch by the bank authorities and the Government.
Managing Director cum CEO of the J&K SCARD Bank Ltd, in a recent circular dated August 8, 2025, conveyed that owing to various inspection reports under process of finalization by RCS Office, NABARD and J&K Bank, the final decision regarding payment towards maturity of Deposits shall be taken after consolidation of all the three audit inspection reports, which may take time of around two months.
“In view of the above facts, all the branch heads are directed to convey the same to their esteemed depositors accordingly and assure the depositors that their savings in our bank are safe and there is nothing to worry or get panicky,” read the circular. Meanwhile, the Cooperative Department has directed the MD SCARD Bank that all operational and financial records from all the branches of JK SCARD Bank must be immediately shifted and centralized at the Head Office Jammu/ Srinagar. Further, MD of the bank has been made personally responsible for safety, security and possession of these records.
While the bank seems making lame excuses and uncertainty looms large over the deposits, the situation is further complicated by the fact that the Reserve Bank of India (RBI) has no control over JK SCARD Bank, leaving depositors without the safety net of a minimum sum assured of Rs 5 lakh.
The affected depositors have met with various Ministers, Divisional Commissioner Jammu, and the Deputy Commissioner Jammu, seeking relief and justice. While the authorities have assured that every effort will be made to resolve the issue, the suffering of the poor depositors continues. As the situation stands, the depositors remain in a state of limbo, unsure of when they will be able to access their hard-earned savings.
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