State Bank of India has come up with the revival of a scheme wherein irrigation as well as crop loans would be given to farmers at cheap rates. This scheme would be a helping aid to farmers for the upcoming kharif season and the rabi season that would follow thereafter, reported a bank official.
The scheme comes as a follow on after the banking major extended its special home loans till June.
The bank has increased its lending rates on a marginal amount. The scheme was first introduced during the monsoon and drought season last year as a relief to the farmers. The rates are still lower than the normal floating rate loans.
SBI has said that it would be coming up with fresh irrigation loans at 8.5% for the first year and 9.5% for the second and third years. These rates apply to those loans amounting upto Rs. 25 lakh and have a repayment period of three years and above. Apart from the scheme, the rates would be in the range of 10.50% to 13.25%.
Crop loans for sum of Rs. 3 lakh and up to Rs 25 lakh would be charged at 10% for one year. Timely repayment would gather 1% concession. This is to encourage "timely repayment culture," the bank said.
"A combination of minor irrigation and crop finance concessions are required for helping farmers build capacity at this juncture," said an SBI official.
New minor irrigation loans would bear margin money requirement at 10% flat from the original levels of 15% to 25% of the project cost.