Agriculture Loans Agri Insurances
The Farm Service Agency (FSA) of the United States Department of Agriculture (USDA) is the general supplier of the agriculture loans. State loans or local loans are also available but the most well-funded and easy to secure service is offered by the federal programs and thus people always tend to go to them. Agriculture Loan is very important to the development of agriculture as it provides the farmers with necessary financial assistance for doing their field works. Often, it is seemed that, the farmers are unwilling to step into the field of agriculture due to the financial problem. Thus, this project will help them in a long way. There are also few categories of loans to choose for them.
Categories of Agricultural Loans in India
There are 5 categories of loans in agriculture. Here we are describing the agricultural loan of different categories in India.
Warehousing Loan or Farm Storage Facilities Loans:
This loan is provided by the government of India. This loan service is also offered by the banks of India. This loan service is basically provided for storage of farm or agriculture commodities for preserved commodities. This loan service actually helps to afford the cost to build a storage facility for agricultural properties. There are certain categories of things which can be kept in the storage and those who follow the rules can qualify for this loan and get up to $500, 000 from federal government.
Farm Operating Loans:
This loan service is provided for the daily needs of the farmers. This loan service also covers the extension requirement.
Farm Ownership Loans:
This loan service involves loans for buying agricultural fields, machinery, livestock, etc.
Fisheries Finance Program:
This project is very different and it is only planned for particular projects in fisheries that qualify under the direction of congress. Through a straight loan program, a capable program is eligible for up to 80 percent financing. This loan projectile is sketched to refinance a private arrear on a fishing vessel. This loan program will also offer repairs and maintenances on an existing vessel.
Further Agriculture Loans:
The Farm Service Agency provides agriculture subsidy, farm labor housing and grants for agriculture. The government provides loan opportunities for the farmers in case they have lost their cop or in case of crop damage.
Different Governmental Schemes
Channelizing all governmental methods to the farmers is done by a nationalized bank named State Bank of India. The farmers are not always aware of the schemes implemented by the government, thus this bank helps them realize about different method and schemes of the government. Also, there are various banks in India that provides different kisan credit cards, agriculture insurance schemes, crop loans, etc. We are giving information about different Agricultural methods and schemes below in a table.
|Agricultural Scheme||Thorough Information|
|Crop Loans||This scheme is implemented to give loans to the farmers for raising various crops or developing them.|
|Produce Marketing Loan||This scheme offers credit for a short period during necessity at|
|Kisan Credit Card||This scheme is the most unique scheme in agriculture. The farmers can draw a cash loan for the production of their crops. They can also fulfill their domestic needs by using the cash. But they must have to maintain the sanctioned limit of the card which they will get from the card-issuing branch.|
|Loan against Warehouse Receipts||For storing their agricultural properties and equipments, the farmers can get loans up to 70% of the value of the goods.|
|Kisan Shakti Yojana||Kishan Shakti Yojana offers farm investment credit. With the help of this scheme the farmers can acquire personal or domestic loans. This loan helps the farmers repaying debt to moneylenders.|
|Land Development Scheme||This scheme is implemented for any development activities on existing land. Land leveling, recuperation of soil, binding and other developmental works are covered under this scheme. It also involves soil conservation measures.|
|Mirror Irrigation Scheme||This scheme provides loans for deepening existing wells and also for digging new wells.|
|Farm Mechanization Scheme||This loan program is provided by different banks for buying different agriculture equipments and small and large farming machineries. This loan program also covers the costs of the purchasing of tractors.|
|Financing of Combine Harvesters||This scheme provides loans for an individual farmer or a group of farmers for buying combine harvesters and heavy harvesting machines.|
|Land Purchase Scheme||This scheme is very easy to understand and we can understand the motive of the scheme by its name. This scheme assists small, marginal and landless farmers or laborers for purchasing land.|
|Dairy Plus Scheme||This scheme provides loans for purchasing of milch animals, founding of dairy firm, construction of shed and milking machines. This scheme provides loans for anything related to the dairy equipments.|
|Broiler Plus Scheme||This scheme provides loans for the construction of poultry shed and feeding room. It also funds the layer and poultry firm.|
|Horticulture Finance||This scheme consists of loans for development of fruit orchard such as grapes, apple, mango, etc. This scheme also provides loans for development of green house and loans for poly house. The best feature of this scheme is that it provides loans for anything related to the development and marketing of green house development or such process.|
|Agri Business Heads Scheme||This scheme is very important for the officially skilled people as it gives them self employment chance for setting fresh agribusiness. If anybody is willing to do farming, he can also buy farm machineries through this scheme.|
Agriculture Finance or Loan Costing
The Reserve Bank of India released a circular about the loan procedure in India. From this circular, we get to know that the dispensation fee for agriculture loans must not be more than 1% of the total loan amount. We also get to know that the dispensation fee must not be included in the interest cap of 26%, from the circular. This circular is very important in terms of Indian agriculture as it helps to provide necessary information about the loan procedure of agriculture in India.
The Agriculture loans are of two kinds. One is direct agriculture loans and the other one is indirect agriculture loans.
Direct Agriculture Loans
The direct agriculture loans include loans provided to individual farmers who are directly engaged in Agriculture and Ailed activities. They can be engaged in these activities via dairy, fishery, poultry, etc. This loan program is provided to individual farmers. It can be also provided to the groups of individual farmers. The Self Help Group (SHGs) or Joint Liability Groups (JLGs) are the groups of individual farmers and they can be provided with Direct Agriculture Loans provided that banks preserve disaggregated data on these loans.
Indirect Agriculture Loans
Indirect agriculture loans are given to the corporate institutions instead of the farmers. This loan program provides loans to the companies of individual farmers. This loan program also provides loans to the partnership firms and the co-operative farmer companies.
- HDFC processes the Kisan Gold Card (saral). The processing fee of this card is Rs 250. Also HDFC charges Rs 200 per request for repayment schedule. The delayed payment penalty for Kisan Gold Card types differs from 1.33% to 2% p.m. on unpaid payment. Administration charges for Kisan Gold Card types ranges from Rs 500 to Rs 2000.
- The dispensation fee of Agriculture term loan from JK Bank is Rs 0.05% of the total amount sanctioned and in this case everybody must pay Rs. 25 up front as a minimum cap.
- Dispensation fees of agriculture goal loan provided by Canara Bank differ from no charges (Loan up to Rs 25000) to Rs 900 (Loan up to Rs. 3 lakh). The handling charges also vary from 0 to Rs. 100. Mortgage charge differs from no charges at all to Rs. 30000.
- ICICI bank charges the processing fee of agriculture loan and it is up to 4% of the total loan amount. There is also a late payment fine which is 2& p.m. on unpaid installment.
- Dispensation fee of agriculture loan from Vijaya Bank ranges from no charges (Rs 25000) to 0.16% of the gross amount (Rs. 25000 to Rs. 2, 00,000). There is also no processing fee for loans up to 10 lakh and no charges for documentation for credit limit of more than Rs 2 lakh.
- For the Kisan Credit Card there is no processing and documentation charges and no collateral security for loan exceeding Rs 1 Lakh.
- The farmers doesn’t need to pay stamp duty on agriculture loans exceeding Rs. 5 lakh as they have been exempted from it by the Indian government.
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