Bank loan interest to farmers reduced

Lending rates for the three agricultural credit schemes operated by the Central Bank on behalf of the government have been reduced with effect from January 1, the bank said on Wednesday.

Accordingly, the annual interest rates for the loans granted to the farmer community under the New Comprehensive Rural Credit Scheme (NCRCS), Agro Livestock Development Loan Scheme (ALDL) and Krushi Navodaya Special Loan Scheme have been reduced by 4 %. The new rate for the NCRCS is 8 % from 12 %, ALDL 8 % from 12, the the last-named scheme also 8 % from 12 % 

The NCRCS loan scheme caters to 34 field crops including paddy and is provided to farmers for cultivation purposes. This scheme is also extended to buyers of these agricultural commodities, who have signed forward sale agreements with the farmers. Total loans amounting to approximately Rs. 10 Billion are disbursed each year under this loan scheme. “The government’s intention for reducing the interest rates of such loans is to encourage new investment in agricultural and animal husbandry projects,” the bank statement added.