Agriculture Loan

Agriculture loans/crop loans are a type of financing that helps farmers cover the costs of their operations. This can include the purchase of land, equipment, seeds, fertilizer, and livestock. Agriculture loans can also be used to finance the construction of barns, irrigation systems, and other infrastructure.

Agriculture loans can be a valuable tool for farmers, helping them to start or expand their operations. However, it is important to carefully consider the terms of any loan before taking it out. Farmers should make sure that they can afford the repayments, and they should shop around for the best interest rates.

Interest Rates for Crop Loans

The interest rates for a crop loan vary from lender to lender. Find the best interest rates for your crop loan and nourish your farm's future with fertile financial options. Here is the highlight of interest rates and charges for a crop loan:

Interest rate 7% p.a. onwards
Processing fee 0% to 4% of the loan amount

Agriculture Loan Interest Rates by Banks

Get a quick overview of agricultural loans from leading banks in the table below.

Top Banks Interest Rate
State Bank of India 7.25% p.a. onwards
IDBI Bank 7% p.a. onwards
IndusInd Bank 10% p.a. onwards
Central Bank of India Up to 13.25% p.a.
Karur Vysya Bank 8.30% p.a. onwards
Note: The interest rates are subject to change. Do visit the official website for updated rates.

Eligibility Criteria for Agricultural Loan

Agricultural loans break down financial hurdles, opening doors for new farmers, women entrepreneurs, and marginalized communities to join the thriving agricultural landscape. ‍Here are the eligibility criteria for Agricultural Loan:

  • Applicants must be between 18 and 70 years old.
  • Individual farmers can apply either alone or jointly with other farmers.
  • Tenant farmers, farm lessees, and sharecroppers: Eligible with proper documentation of land use agreements.
  • Self Help Groups (SHGs) and Joint Liability Groups (JLGs) can apply for collective loans.

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Documents Required for Crop Loan

The specific documents required for a crop loan may vary depending on the financial institution, region, and cultivated crop type. However, here is a general list of documents that are commonly required when applying for a crop loan:

  • Provide two passport-sized photographs.
  • Complete the application form with the necessary details.
  • Present your Kisan Credit Card.
  • Show identity proof, such as Voter ID, PAN card, Aadhar Card, Ration card, etc.
  • Furnish address proof, including utility bills (Electricity/Water Bills), Voter ID, Aadhar Card, etc.
  • Provide income proof, including bank statements, ITR, etc.

Agriculture Loan EMI Calculator

An Agriculture Loan EMI Calculator helps you estimate the monthly repayment amount for your agricultural loan based on the loan amount, interest rate, and tenure.

Use the Agriculture Loan EMI Calculator to plan your repayments conveniently. Simply enter the loan amount, interest rate, and tenure, and the calculator will provide you with the estimated Equated Monthly Installment. This tool ensures you have a clear understanding of your monthly financial commitment, allowing you to manage your agricultural loan with ease.

List of Cooperative Banks Offering Agricultural Loans

Following are some of the major Cooperative Banks Offering agricultural loans in India:

Top Lenders Major Agricultural Loans Offered
State Bank of India (SBI)
  • Crop Loan
  • Kisan Credit Card (KCC)
  • Drip Irrigation Loan
  • Combine Harvestor Loan
  • Farmer Finance / Agriculture Loan/ Krishi Loan
  • Long Term Agricultural Loan
Central Bank of India
  • Cent Kisan Tatkal Scheme
  • Cent Vermicompost Scheme
  • Cent Solar Water Heater Scheme
  • Kisan Credit Card
Union Bank
  • Crop Loan
  • Kisan Credit Card
  • Farm Mechanization Loan
Axis Bank
  • Kisan Power
  • Kisan Matsya
  • Kisan Mitra
  • AGPRO Power

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Types of Agriculture Loans

Here is a list of the major types of agricultural loans offered by various banks and other lenders in India:

  • Crop Loan/ Kisan Credit Card (Retail Agri Loan):
    • Ideal for short-term credit requirements.
    • Covers expenses like seeds, fertilizers, and equipment maintenance.
    • Available as an electronic RuPay Card for convenient access to funds.
  • Agriculture Term Loan:
    • Long-term loan (up to 48 months) for non-seasonal expenditures.
    • It can be used for purchasing new machinery, installing solar power, etc.
    • Repayment tenure of 3-4 years with flexible installment options.
  • Farm Mechanization Loan:
    • For purchasing new agricultural equipment, repairing old ones, etc.
    • Some banks offer specific loans for tractors, harvesters, or irrigation equipment.
  • Solar Pump Set Loan: Long-term loan (up to 10 years) for purchasing a solar pumping system for irrigation.
  • Loan for Allied Agricultural Activities: For working capital and long-term investment needs in allied agricultural activities like poultry, dairy farming, etc.

Benefits of Agriculture / Crop Loans

Choosing the right type of crop loan is crucial for maximizing benefits and meeting your specific needs. Here are the benefits of crop loans:

  • Fuel Your Season: Secure essential funds for seeds, fertilizers, and labor, ensuring your crops sprout strong.
  • Grow Beyond Today: Invest in long-term upgrades like equipment, land improvements, or buildings, boosting your farm's future value.
  • Work Smarter, Not Harder: Modernize with machinery, streamline operations, and reap the rewards of increased efficiency and yields.
  • Breathe Easy with Cash Flow: Repay after harvest, avoid financial pressures during growth, and maintain smooth cash flow.
  • Empower Your Farm: Build a credit history, access future opportunities, and contribute to agricultural development and rural prosperity.

Application Process for Crop Loans

Here are the key steps to apply for an agriculture loan:

1. Research Loan Options: Search online or visit bank branches to learn about eligibility criteria, interest rates, terms, and documentation requirements for agriculture loans like crop loans, equipment financing, etc.

2. Choose a Suitable Lender: Identify a bank or financial institution that offers an agriculture loan suited to your needs in terms of loan amount, interest rate, repayment schedule, etc.

3. Apply Online or Offline: If applying online, visit the lender's website, find the agriculture loan section, and fill up the application form by providing the required details. For offline application, visit the nearest branch office of the lender with the necessary KYC and income documents and submit the completed application form.

4. Submit Essential Documents: Provide identity proof, address proof, farm details, and other supporting documents along with the application form through online upload or offline submission.

5. Track Application Status: Keep following up with the lender through the website, call center, or relationship manager to know the status of your agriculture loan application.

6. Loan Approval and Disbursement: The lender will transfer the loan amount directly to your bank account upon approval.

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Frequently Asked Questions

A crop loan is a short-term loan given to farmers to meet expenses related to crop cultivation. Unlike other agriculture loans for farm equipment, land purchase, etc., crop loans cover only the costs of growing crops in one agricultural cycle.

All farmers including small, marginal, and tenant farmers growing crops can apply. The lending bank will assess land records, credit history, and KYC documents to determine eligibility.

Low interest rates, collateral-free loans up to ₹1 lakh, minimal documentation, and customized repayment schedules based on crop harvests are some key features.

RBI mandates commercial banks to provide crop loans up to ₹3 lakh at 7% interest. Farmers repay 4% while the government subsidizes the remaining 3%.

KYC documents, land ownership certificates, details of crops grown, and input costs are some of the documents needed during application.

No. Crop loans can only be used for financing the production costs of crops cultivated in that particular season.

Yes. Interest subsidy makes crop loans affordable. The government also provides subsidies on seeds, machinery, and crop insurance to support farmers.

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