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Farmers to get short-term loan at 7 pc interest rate in FY17

Farmers Will Get Short-term Crop Loans Of Up To Rs 3 Lakh At A Lower Interest Rate Of 7 Per Cent This Fiscal With The Government Approving A 2 Per Cent Interest Subvention Scheme. Also, Farmers Who Would Repay The Loan On Time Will Get The Credit At More Cheaper Rate Of 4 Per Cent.

PTI | Updated on: 05 Jul 2016, 08:05:19 PM

New Delhi:

Farmers will get short-term crop loans of up to Rs 3 lakh at a lower interest rate of 7 per cent this fiscal with the government approving a 2 per cent interest subvention scheme. Also, farmers who would repay the loan on time will get the credit at more cheaper rate of 4 per cent.

Under the interest subvention scheme approved by the Cabinet today, farmers will get loans of up to Rs 3 lakh for a period of one year at an interest rate of 7 per cent.

The Cabinet also approved an additional subvention of 3 per cent for those farmers who pay loans on time.

The interest subvention scheme is applicable for all farmers availing short-term crop loans up to Rs 3 lakh for one year, Telecom Minister Ravi Shankar Prasad said after the Cabinet meeting.

Government has set an agricultural credit target for banks at Rs 9 lakh crore for the current fiscal, up from Rs 8.5 lakh crore 2015-16.

To reduce the burden of loan repayment on farmers, government has made a provision of Rs 15,000 crore in the budgetary estimate of 2016-17 towards interest subvention.

The interest subvention scheme was earlier implemented by the Finance Ministry. It was transferred to the Agriculture Ministry this year.

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First Published : 05 Jul 2016, 08:03:00 PM

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Short-term Crop Loans