The Reserve Bank of India (RBI) has said that the interest subsidy scheme (ISS) for farmers will be implemented through the direct benefit transfer (DBT) mode from the financial year 2019. Under the scheme, farmers can avail of short-term crop loans of up to Rs 3 lakh at subsidised interest rate of 7 percent that could go down to 4 percent on prompt repayment. The government has earmarked a sum of Rs 15,000 crore for this purpose.
Central bank has said that as advised by government, from 2018-19 the ISS is being put on DBT mode on ‘In kind/services’ basis and not on ‘In cash’ basis and all loans processed in 2018-19 are required to be brought on ISS portal/DBT platform, once it is launched. In a notification, it said that the ISS 2018-19 will be required to be settled as applicable in Plan Scheme - Scheduled Caste (SC), Scheduled Tribe (ST) and North East Region (NER), among others. The notification also asked the banks to capture category-wise data (General, SC, ST, etc) of beneficiaries for reporting of the same on ISS portal ‘individual farmer wise’ to settle the claims arising from 2018-19 onwards.
RBI said that till the DBT portal becomes functional, banks are requested to submit their claims, category-wise and further stated that it is working on the detailed modalities regarding categorisation of loans. It stated that till the modalities are finalised, banks may obtain the category-wise data on self-declaration basis and there should however be no cap on the loans given under each category. Under the ISS, interest subvention is provided to NABARD, regional rural banks, cooperative banks, public sector banks as well as private banks for providing short term credit to farmers at subsidised rate of interest.
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