For small and marginal farmers, recently a loan scheme has been introduced by government of India wherein farmers as well as agri entrepreneurs can purchase agricultural land. The loan can also be availed if one wants to develop an agricultural land and/or waste land.
Here we share all about the Agricultural Land Purchase Loan Scheme –
Eligibility –
- Marginal and Small owners having land in their own name – a. 2.5 acres irrigated land or b. 5 acres non-irrigated land
- Entrepreneurs with agricultural background
- Tenant farmers cultivating 2.5 acres irrigated land or 5 acres non-irrigated land
These are the basic eligibility criteria for farmer’s land loan. Each bank might have an additional criterion. For instance, SBI is giving the land loan to only those farmers who have a record of prompt repayment for at least 2 years either from their bank or from other banks. In case, you haven’t taken any loan and repaid it back you cannot avail this loan under agricultural land purchase scheme.
Maximum amount Available – 10 lakhs
Interest on Land Purchase Loan Scheme
- For loan upto Rs. 50,000 – Bank’s MCLR + 0.5%
- For loan between Rs. 50,001 to Rs. 5,00,000 – Bank’s MCLR + 1.00%
- For loan between Rs. 5,00,001 to Rs. 10,00,000 – Bank’s MCLR + 1.5%
MCLR is Marginal Cost of Funds based Lending Rates. Different banks have different MCLR depending upon the loan period. (Know about MCLR here)
Repayment Method – Half Yearly/Yearly Instalment
Repayment Period – 7 to 10 years (maximum moratorium period – 2 years (24 months)
Processing Charges
- Upto Rs.25,000 – Nil
- Anything above that is at the discretion of the bank providing loan
Documents Required for the Loan:
- Land records and documentation
- No due certificate
- Sale Agreement Copy
- Any additional document asked by the bank
Some of the Banks Providing Agricultural Land Purchase Loan Scheme for Small and Marginal Farmers are:
- State Bank of India
- IDBI Bank
- Central Bank of India
- Bank of Baroda
- Bank of Maharashtra
- Union Bank of India and others
This is all about the agricultural land purchase loan for small and marginal farmers. However, the question remains whether the small and marginal farmers can meet the eligibility and requirements set by the government especially that of State Bank of India where the lender has to be an existing borrower with good repayment record.
Also Read: Digital India: How About eSupply of Seeds & Fertilizers Instead Of Futile Apps for Farmers?
