Reserve Bank of India has announced modalities for offering 2% interest subsidy on short-term loans of up to Rs 2 lakh for farmers who are engaged in animal husbandry and fisheries through Kisan Credit Card or KCC. With this interest subvention, farmers would get short-term loan of up to Rs 2 lakh at a concessional rate of 7%. It must be noted that the interest subsidy scheme is valid for loans taken in 2018-19 & 2019-20.
Farmers who pay the loans on time will be eligible for another 3% discount on the interest rate.
The RBI said this also means that the farmers paying back promptly will get short-term loans at the rate of 4% per annum during 2018-19 & 2019-20.
It further said that the interest subvention will be offered on a maximum limit of Rs 2 lakh short-term loan to cultivators involved in fisheries and animal husbandry.
The farmers already holding KCC (crop loan) and involved in fisheries and animal husbandry activities can avail a sub-limit for such activities.
RBI said, "However, the interest subvention & prompt repayment incentive benefit on short-term loan (crop loan plus working capital loan for animal husbandry & fisheries) will be available only on an overall limit of Rs 3 lakh /annum & subject to a maximum limit of Rs 2 lakh / farmer involved in activities only related to animal husbandry and or fisheries”.
