Reserve Bank of India vide Notification No RBI/2018-19/137 dated 07th March 2019 has announced that the Government of India has approved the implementation of the Interest Subvention Scheme with modifications for the years 2018-19 and 2019-20 for short term crop loans up to Rs. 3 lakh with the following stipulations:
To provide short-term crop loans upto Rs. 3 lakh to farmers at an interest rate of 7% p.a. during the years 2018-19 and 2019-20, interest subvention of 2% p.a. will be provided to Public Sector Banks (PSBs) and Private Sector Commercial Banks.
To provide an additional interest subvention of 3% p.a. to those farmers repaying on time. This benefit would not accrue to those farmers who repay their crop loans after one year of availing such loans.
This benefit of interest subvention will be available to small and marginal farmers having Kisan Credit Card for a further period of upto six months post the harvest of the crop at the same rate as available to crop loan against negotiable warehouse receipts issued on the produce stored in
warehouses accredited with Warehousing Development Regulatory Authority.
To provide relief to farmers affected by natural calamities, an interest
subvention of 2% p.a. will be made available to banks for the first year on the restructured loan amount. Such restructured loans will attract normal rate of interest from the second year onwards.
However, to provide relief to the farmers affected due to severe natural calamities, an interest subvention of 2% p.a. will be made available to banks for the first three years/entire period (subject to a maximum of five years) on the restructured loan amount.
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