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Government approves extension of interest subvention for farmers for 2021-22

An additional interest subvention of 3 percent per annum will be provided to the farmers repaying in time.

April 28, 2022 / 05:41 PM IST
Women farmers work in a paddy field. (Representative image: Reuters)

Women farmers work in a paddy field. (Representative image: Reuters)

The Government of India has approved the continuation of the Interest Subvention Scheme for agriculture and allied activities for the year 2021-22 on an interim basis, the Reserve Bank of India said in a circular issued to bank chiefs on April 28.

An interest subvention of 2 percent will be given to banks for loans availed through Kisan credit cards (KCC) for up to a limit of Rs 3 lakhs, said the RBI.

This interest subvention of 2 percent per annum will be calculated on the loan amount from the date of disbursement to the date of actual repayment of the loan by the farmer or up to the due date of the loan fixed by the banks, whichever is earlier, subject to a maximum period of one year, the RBI said.

An additional interest subvention of 3 percent per annum will be provided to the farmers repaying in time, i.e., from the date of disbursement of the loans up to the actual date of repayment or up to the due date fixed by the banks for repayment of such loan/s, whichever is earlier, subject to a maximum period of one year from the date of disbursement.

This also implies that the farmers repaying promptly as above would get short-term crop loans at 4 percent per annum during the financial year 2021-22, the RBI said.



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first published: Apr 28, 2022 05:41 pm
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