In the wake of national lockdown due to Covid-19, the Government has extended the benefit of two per cent Interest Subvention to Banks and three per cent Prompt Repayment Incentive to all farmers upto 31st of May this year.
The interest subsidy has been extended to all crop loans upto 3 lakh rupees given by banks which have become due or are becoming due between 1st of this month to 31st May, 2020. Ministry of Agriculture said that due to restrictions imposed on movement of people, many farmers are not able to travel to bank branches for payment of their short term crop loan dues. It also said, due to restrictions on 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.
The Ministry said, to address this problem being faced by farmers, extension of Interest Subvention and Prompt Repayment Incentive (PRI) benefit will help the farmers to repay such loans upto the extended period at 4 per cent per annum interest without attracting any penalty.
Government is providing concessional crop loans to farmers through banks with 2 per cent interest subvention to banks and 3 per cent additional benefit on timely repayment to farmers thus providing loans upto 3 lakh rupees at 4 per cent per annum interest on timely repayment.