Krishi VaartaThe Economic Times
Govt extends crop loan repayment date till August 31; prompt re-payers to benefit
NEW DELHI: The government on Monday decided that farmers who availed short-term crop loans at a concessional rate of 4 per cent per annum and missed their repayment after March 1, can now repay by August 31 without paying any penalty. The decision, taken by the Cabinet headed by Prime Minister Narendra Modi, to extend the loan repayment date will help farmers in avoiding travelling to banks for renewal or repayment of loans during the ongoing COVID-19 pandemic period, an official statement said.
This is the second time the repayment date has been extended. Earlier it was extended till May 31.Normally, farm loans are given at an interest rate of 9 per cent. But the government is providing a 2 percent interest subsidy to ensure farmers get short-term farm loans of up to Rs 3 lakh at an effective rate of 7 per cent per annum.
However, the interest rate gets even lower at 4 per cent to those farmers who repay their loans timely. The Cabinet decision taken will benefit these categories of farmers."Farmers who will repay their loan before August 31 will be levied a concessional interest rate of 4 per cent, which is for prompt repayers," Agriculture Minister Narendra Singh Tomar told the media after the meeting.
"The government makes an effort to lessen the inconvenience caused to people. Earlier, we thought that the movement of people would become smooth by May 31. But we have received the feedback that there is still a problem in movement. So, we extended the deadline for loan repayment. So, there is no point linking with other things," he said.
Tomar also said the government had borne crop loan interest subsidy of Rs 18,000 crore last fiscal and this might increase in the current year.With regard to Kisan Credit Card (KCC), the minister said the government has provided KCC to 6.65 crore farmers at present and aims to reach out additional 2.5 to 3 crore farmers.The farm credit target for the current fiscal has been set at Rs 15 lakh crore.
Source: The Economic times, 1 May 2020
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