In the wake of lockdown due to ongoing Covid-19 pandemic, the Government has decided to extend the benefit of 2% Interest Subvention (IS) to Banks and 3% Prompt Repayment Incentive (PRI) to all the farmers across the country up to 31st May, 2020 for all crop loans up to Rs.3 lakh given by banks which have become due or are becoming due between 1st March 2020 and 31st May, 2020.
Due to restrictions imposed on the movement of people, many farmers are not able to travel to bank branches for payment of their short term crop loan dues. Moreover, due to restrictions on the movement of people and difficulty in timely sale and receipt of payment of their produce, farmers may be facing difficulties in repayment of their short term crop loans falling due during this period.
To address this problem being faced by farmers, the extension of Interest Subvention (IS) and Prompt Repayment Incentive (PRI) benefit up to 31st May, 2020 on the short term crop loans up to Rs.3 lakh which are due up to 31st May, 2020, shall help the farmers to repay such loans up to the extended period at 4% p.a. interest without attracting any penalty, says recent PIB reports.
Providing Concessional Crop Loans to Farmers
Government is providing concessional crop loans to farmers through banks with 2% p.a. interest subvention to banks and 3% additional benefit on timely repayment to farmers thus providing loans up to Rs.3 lakh at 4% p.a. interest in timely repayment.