Govt nod to ₹15.6K cr for farm loan interest subsidy

THE UNION CABINET on Wednesday approved ₹15,642 crore for providing interest subsidy to farmers on working capital loans for the current fiscal.

- FE BUREAU

Under this Modified Interest Subvention Scheme (MISS), farmers taking short-term loans of up to ₹3 lakh through Kisan Credit Cards (KCC) will have to pay just 7% interest, including 1.5% interest subvention.

Additionally, farmers repaying loans promptly are eligible for an incentive of up to 3% as Prompt Repayment Incentive (PRI) effectively reducing their interest rate on KCC loans to 4%.

For loans taken exclusively for animal husbandry or fisheries, the interest benefit is applicable for up to ₹2 lakh, according to a statement issued after the meeting of the Cabinet. There are more than 77.5 million KCC accounts in the country.