SBI cuts interest rates for minor agriculture loans

Aims at helping drought-hit farmers

  Currently, the interest rates under this category are in the range of 10.5 to 13.25 per cent.
This rate cut by SBI for agri loans was aimed at reducing the cash flows of farmers who have been hit due to the drought.   Replying to a poser, SBI’s General Manager (Agri business Unit) Niranjan Parsha said “the Bank will come out with more measures if necessary but from fourth year onwards, they (customers) will have to pay normal interest rates on this loan.”    

SBI this morning launched a spate of measures for farm loan borrowers, including interest rate reductions on irrigation and crop loans, to support drought-hit farmers.  Accordingly, the bank has also reduced interest rates on crop loans between Rs 3-25 lakh to 10 per cent for one year.     
At present, crop loans between Rs three to five lakh are priced at 11.75 per cent while those above Rs five lakh and up to Rs 25 lakh are being offered at 12.75 per cent.
Moratorium extended
Apart from slashing rate for agri-loans, SBI also extended moratorium period for new minor irrigation loans by additional one year and announced an additional one per cent interest rate concession to borrowers who pay loan within the stipulated period.  It has brought down the loan processing charges by 50 per cent in order to lessen the burden of the stressed borrowers.     
Besides, SBI also advised its offices to release the consumption loan portion of Kisan credit cards to farmers to enable them meet financial needs.  
The offers will be applicable to all agri loans disbursed between April 1, 2009 and up to March 31, 2010.  These measures were to benefit farmers both in the Kharif and Rabi season, said an official.    

It may be noted that SBI’s total agriculture loan outstanding is Rs 57,000 crore as against Rs 46,000 crore in the year-ago period.  
It has disbursed Rs 6,000 crore worth fresh agriculture loans in the current fiscal.  Currently, SBI has roughly 70 lakh customers in its agriculture portfolio.
DH News Service

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