Top 7 Banks Providing Easy Loans To Farmers | 70017


Top 7 Banks Providing Easy Loans To Farmers

Agricultural loans are provided to farmers, sharecroppers, joint cultivation units, self-help groups and others engaged in agriculture and other activities related to agriculture. Agriculture loans can be either secured or unsecured, depending on the loan type and lending institution. Besides the various government schemes, several commercial banks also offer agriculture loans in India.

An agricultural loan is available for various purposes like meeting expenditure related to cropping, investment in farm machinery, the building of irrigation channels, setting up allied agricultural activities, etc.

In this article, we have compiled a list of the top 7 banks which provide easy loans to farmers in India.

1. State Bank of India (SBI)
State Bank of India (SBI) is one of the pioneer banks in agri-financing. With its wide network of more than 16,000 branches across India, it caters to nearly 1.01 crore farmers. The bank offers a wide range of agriculture loans and some of the main features are:

Nominal-interest rates

No intermediaries

No hidden fees

Immediate loan granting and disbursement

SBI Agri loan is offered to all agriculture and related activities. Loans are offered for crop production and these are mainly in the form of KCC (Kisan Credit Card). The loan is offered to cover crop production expenses, post-harvest cost, emergency expenses etc.

Kisan Credit Card (KCC) comes in the form of electronic RuPay Card. This card allows the farmer to withdraw money through ATMs, purchase items such as fertilizers at PoS. SBI Agri loans also allow the purchase of equipment and machinery like tractors, combined harvesters, etc. The bank also offers loans for meeting the financial needs of allied activities such as Poultry, Dairy, Fisheries, etc.

2. ICICI Bank
ICICI Bank’s agriculture loan allows farmers to purchase farm animals and also invest in agricultural equipment. Farmers can opt for a flexible repayment of these loans spanning a period of 3 to 4 years. EMIs can be monthly or half-yearly or annual depending on individual convenience.

ICICI Agri loan requires minimum documentation and comes with convenient repayment alternatives with no hidden charges. For availing this loan, farmers must submit an application form along with KYC documents, land/property documents, and in some cases, they must also furnish post-dated cheques.

ICICI Bank also offers Kisan Credit Cards to farmers. This card allows farmers to withdraw from any ATMs throughout India. For availing KCC, one has to obtain farming land and furnish proof of the same. An applicant must be between 18 to 70 years of age.

3. HDFC Bank
Being one of the leading private sector banks in India, HDFC is fully committed to maximising the banking and financial benefits for all sectors across the country. It has a special focus in the rural areas catering mainly to the agriculture sector. HDFC bank offers agricultural loans of different tenures to customers who are engaged in farming activities, horticulture, poultry, dairying, warehousing, animal husbandry, etc.

The bank also provides financial assistance for supplies of various agricultural inputs like seeds, pesticides, micronutrients, fertilizers, and also the purchase of micro-irrigation tools.

HDFC bank has identified storage, food processing, fertilizers, and agriculture-related activities as a focus area and therefore offers various working capital loans as well as term loans to suitable applicants. The loans are provided basis the applicant’s financials and the value of underlying commodities. HDFC bank is constantly increasing its rural footprint to deliver all types of financial products efficiently and at reasonable prices to all its clients.

4. Punjab National Bank (PNB)
Punjab National Bank has multiple financial product offerings associated with the farming sector. For example, an individual can take loans from PNB for setting-up biogas units, purchasing of irrigation apparatus, development of wastelands, etc. Individuals who are keen on pursuing a career in apiculture (also known as beekeeping) are also offered financial assistance from the bank.

PNB also caters to the financing needs for warehouse receipt. It also offers insurance coverage and financial support to growers especially when there is crop failure caused by any natural disasters, pest infection and diseases. This scheme is known as Pradhan Mantri Faisal Bima Yojana. These are over and above the regular financial services provided to farmers such as Kisan Credit Card, debt swap, etc.

5. Allahabad Bank
Allahabad Bank is a top nationalized bank in India which offers Kisan Credit Card (KCC) as part of its Akshay Krishi scheme. This scheme is exclusively designed to provide sufficient and timely financial assistance under a single blanket to needy farmers. Some of the features of this scheme are as follows:

Crop loan feature – Cash Credit

Allied activities feature – Cash Credit – Working capital finance for activities allied to agriculture

Term loan feature – Catering to Capital requirements

The Potato Growers Credit Card Scheme offered by Allahabad bank is unique in that it provides sufficient and timely financial support to all the farmers who need a financial boost for their agriculture and other needs.

Allahabad Bank also offers loans for the purchase of machinery such as tractor /power tillers. Farmers who reside in the vicinity of the Bank’s branches and have a reasonably good reputation in the area can apply for and avail the benefits of this loan.

Additional Reading: Which Bank Is Best For Agriculture Loan In India?

6. Axis Bank
Axis bank has been helping the farming community for many years with its diversified and new-age financial products. Some of these include tractor loans, Kisan Credit Card, warehouse receipt financing, gold loans, etc. The Bank also offers Contract Farming, which caters to the financial needs of combined agreements between farmers and corporates. The bank ensures to release financial assistance via quick mechanisms and support production as well as the supply of the product. This arrangement is primarily managed by the Fair Practices Lending Code.

Axis Bank also has pisciculture loans which is designed to fulfil requirements of farmers promptly. It especially caters to farmers who are into activities related to Freshwater fish or prawn’s cultivation.

7. Oriental Bank of Commerce (OBC)
Oriental Bank of Commerce offers Kisan Credit Card which is also known as Oriented Green Card (OGS). It is offered to qualified farmers to cater to their working capital requirements and financial needs related to crop production. The bank ensures to provide maximum financial aid for farm activities, equipment investment or repairs etc. through the credit card. It also offers term loans to meet the investment needs of farmers who own this card. The Oriented Green Card is offered to farmers, cultivators, artisans, etc for farm and non-farm activities.

Some of the other agriculture-related banking products from OBC are:

Model Scheme – financial assistance for Coconut Farming

Cash Advance – Warehouse Receipts for Farmers

Land acquisition for Agriculture Purposes

Setting up of Agriculture Clinic and Agriculture trade centres

Scheme for Working Capital finance to meet requirements related to Cold Storage

Scheme for financial aid to Timber Merchants and Saw Mills

Financial assistance against Security of Gold Jewellery

Loan for Two Wheelers / Three Wheelers to Farmers

Finance for purchase of Tractors

How to Get an Agricultural Loan at a Low-Interest Rate?
Here are some important tips for farmers to get an agricultural loan at competitive interest rates:

A high credit score is one of your biggest advantages. When you have a high credit score, it indicates your creditworthiness, which is a huge advantage when applying for all loans including agriculture loans.

Ensure that the ratio of debts to income is at the minimum. This indicates a better repayment capability.

Aim to keep your credit utilization ratio at 30%. This indicates you are not hungry for credit, improving chances of loan sanction.

It is advisable to not opt for multiple loan applications parallelly. It can portray you as a high-risk borrower and impact your credit score negatively.

In a nutshell, the above-mentioned banks should be the top-most preferred options for farmers to get easy loans. Apart from these, there are several banks which offer different types of agriculture loans to help farmers in increasing their production and have a steady flow of income. Some of them are UCO Bank, Syndicate Bank, Vijaya Bank, Indian Overseas Bank, Bank of Maharashtra, United Bank of India, etc.



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