Quick Summary
Government Boosts Credit Flow to the Agriculture Sector through Targeted Policy Measures Measures include raising the limit of collateral-free agricultural loans to Rs 2 lakh, expanding Kisan Credit Card coverage, providing 7% interest subvention, and PM- Dhan Dhaanya Krishi Yojana to strengthen credit access for small and marginal farmers among others The Government has taken several measures to increase institutional credit flow to the agriculture sector, including to the underserved agric
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FAQ :
The limit for collateral-free short-term agricultural loans, including those for allied activities, has been raised to £2 lakh per borrower.
The increased limit of £2 lakh for collateral-free agricultural loans came into effect from 1 January 2025.
Small and marginal farmers, who constitute over 86% of the agricultural sector, are expected to benefit the most due to reduced borrowing costs and the removal of collateral requirements.
Short-term agricultural loans provided through Kisan Credit Cards under the Modified Interest Subvention Scheme are offered at a concessional interest rate of 7%.
Yes, farmers who repay their short-term agricultural loans promptly can receive an additional 3% incentive, bringing the effective interest rate down to 4%.
The PM Dhan Dhaanya Krishi Yojana is a new scheme launched to ensure adequate availability of long-term and short-term credit, especially in districts with low agricultural credit disbursement.
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