In view of the situation arising out of the nationwide COVID-19 lockdown, the Centre has extended the benefit of 2 per cent interest subvention (IS) to banks and 3 per cent prompt repayment incentive (PRI) to all farmers till May 31 for all crop loans upto Rs 3 lakh.
The benefit will be given to farmers whose bank loans are due or are becoming due between March 1, 2020 and May 31, 2020.
The announcement comes at a time when farmers are not able to travel due to lockdown restrictions to bank branches for payment of their short term crop loan dues. Moreover, they are facing difficulty in timely sale and receipt of payment of their produce and repayment of their short term crop loans falling due during this period.
"Extension of Interest Subvention (IS) and Prompt Repayment Incentive (PRI) benefit on the short term crop loans upto Rs 3 lakh which are due upto May 31 shall help the farmers to repay such loans upto the extended period at 4 per cent per annum interest without attracting any penalty," said the Ministry of Agriculture and Farmers Welfare.
"Government is providing concessional crop loans to farmers through banks with 2 percent p.a. interest subvention to banks and 3 per cent additional benefit on timely repayment to farmers thus providing loans upto Rs 3 lakh at 4 per cent p.a. interest on timely repayment," it added.
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