Goyal launches platform to enable loans against produce to farmers

Food and Consumer Affairs Minister Piyush Goyal on Monday launched a digital platform to facilitate farmers in getting loans against their produce stored in registered godowns and said it would help boost the farming community's income and make agriculture an attractive proposition.

The minister also announced that the Warehousing Development and Regulatory Authority (WDRA) would soon lower the security deposit paid by the warehouse owner to 1 per cent of the value of the stock from the current 3 per cent.

At an event here, Goyal launched the digital gateway named 'e-Kisan Upaj Nidhi', which aims to facilitate farmers in obtaining post-harvest loans from banks against their stocks stored in the WDRA registered warehouses.

The loans are provided against electronic Negotiable Warehouse Receipts (e-NWRs). At present, there are more than 5,500 registered warehouses under WDRA, while the total number of agri-warehouses is estimated at around 1 lakh.

The minister emphasised the need to modernise Indian agriculture through the use of technology to enhance farmers' income. This will also help in making the farm sector an "attractive proposition".

With the launch of this gateway, Goyal said the farmers will easily get loans at 7 per cent interest rate, without any collateral.

"Farmers can sell their produce stored in warehouses at right time. Farmers would also not be forced to sell their crops in distress," he said.

Banks onboarded on digital gateway will provide a choice to farmers in terms of rate of interest and loan amount.

Goyal said the security deposit for warehouses will be soon reduced to 1 per cent from 3 per cent.

The minister said the world's largest grain storage capacity programme has been launched in cooperative sector and asked the WDRA to register the godown established by cooperatives without any fees.

He said the godowns maintained by Food Corporation of India (FCI), Central Warehousing Corporation (CWC) and WDRA are modern but asked them to make their quality parameters more stringent.

The minister also stressed on the need to modernise the warehouses operated by the state agencies.

Goyal highlighted that the Modi government in the last 10 years has taken many initiatives for the growth of the agriculture sector and also doubling farmers income.

He noted that the procurement of foodgrains and other crops from farmers at Minimum Support Price (MSP) has jumped 2.5 times from the previous government.

The minister asserted that the growth of farm sector was essential for making India a developed nation by 2047.

The WDRA aims to establish a negotiable warehouse receipt system in the country. It's vision is to make warehouse receipts a prime tool of trade and facilitate finance against it, enable banks to improve the quality of their lending portfolio and enhance their interest in lending against goods deposited in warehouses.