Giving a big relief to the farmers, the Reserve Bank of India (RBI) has said that farmers will continue to get short-term crop loan of up to Rs 3 lakh at subsidised interest rate of 7 per cent and the rate could go down to 4 per cent if they repay promptly in 2017-18.
Under the scheme which aims at providing short term credit to farmers at subsidised interest rate, a subvention of 2 per cent per annum is provided for short-term crop loan up to Rs 3 lakh per farmer provided the lending institutions make available short-term credit at the ground level at 7 per cent per annum to farmers. Besides, an additional interest subvention of 3 per cent per annum is available to the prompt payee farmers.
The central bank said that the Ministry of Agriculture and Farmers' Welfare initiated the process for continuation of the Interest Subvention Scheme and it has been decided by the government, as an interim measure, to implement the Interest Subvention Scheme for 2017 -18 till further instructions are received.
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