With a view to ensuring availability of agriculture credit including loans taken against Kisan Credit Card, the Government of India, is implementing an interest subvention scheme of 2% for short term crop loans up to Rs.3.00 lakh, said Minister of State for Ministry of Agriculture & Farmers Welfare Parshottam Rupala in Lok Sabha on Tuesday.
The scheme is implemented through public sector banks and private sector banks, RRBs and Cooperatives through National Bank for Agriculture and Rural Development. Currently, besides 2% interest subvention, the farmers, on prompt repayment of crop loans on or before the due date, are also provided 3% additional interest subvention, he added.
As per the extant policy crop loans upto Rs.3.00 lakh per farmer provided by District Central Co-operative Banks and Primary Agricultural Co-operative Societies at 7% per annum are eligible for refinance (through State Cooperative Banks/District Central Co-operative Banks) from National Bank for Agriculture and Rural Development (NABARD) out of Short Term Cooperative Rural Credit (STCRC) fund allocated by Government of India every year, Rupala underlined.
Presently, Union Government is not considering any proposal to provide funds equal to 90% of the interest subvention to the financial institutions as advance.