Priority Sector Schemes
a. To meet the short term credit requirements for cultivation of crops
b. Post harvest expenses
c. Produce Marketing loan
d. Consumption requirements of farmer household
e. Working capital for maintenance of farm assets and activities allied to agriculture, like dairy animals, inland fishery etc.
f. Investment credit requirement for agriculture and allied activities like pumpsets, sprayers, dairy animals etc.
All Farmers â Individuals / Joint borrowers who are owner cultivators,ii. Tenant Farmers, Oral Lessees & Share Croppers, SHGs or Joint Liability Groups of Farmers including tenant farmers, share croppers etc.are eligible for KCC.
Credit limit may be fixed based on operational land holding, cropping pattern and ancillary & contingency needs of the farmer for the full year. For farmers raising more than one crop in a year, the limit is to be fixed depending upon the crops cultivated as per proposed cropping pattern. The criterion for fixing production credit limit is based on extent of cultivated area of the farmer. The appraiser/sanctioning authority shall exercise due diligence while working out the limit and the actual limits may be fixed on case to case basis and calculated separately for irrigated and un-irrigated land. There is no maximum loan limit under the KCC scheme. The fixation of credit limit is uniformlyapplicable to all categories of farmers.
Insurance of tractorTo save the farmer from the burden of comprehensive insurance, Punjab & Sind Bank has waived the condition of comprehensive insurance. Now the farmer may opt for membership of Tractor Welfare Fund of the bank. Tractor is to be insured for Third party only. The farmer who has opted for Tractor Welfare Fund Scheme has to contribute only Rs.300/- per year in the Tractor Welfare Fund. In case of serious accident where the amount of loss is more than Rs.10,000, compensation to the extent of 50% of the assessed loss is provided from the Tractor Welfare Fund. By becoming member of Tractor Welfare Fund Scheme, the farmer saves Rs.15,000 to Rs.20,000 over a period of 9 years. The Tractor Welfare Fund is maintained by a Trust named " PSB Trust for Development of Agriculture & Rural Employment". The funds collected in Tractor Welfare Fund are utilized for the benefit of farming community.
- For tractors: Any individual or group of individuals jointly holding ownership of minimum of 2.5 acres of perennially irrigated agricultural land. Economic viability of financing tractor in each case shall be worked out keeping in view his total cultivation of agriculture land, income from custom hiring etc.
- For Power tillers/ threshers/Reapers/Any other implement: Any individual or group of individual jointly holding ownership of minimum of 2.0 acres of perennially irrigated agricultural land. Financing of power tiller/thresher/reaper or any other implement like mechanized sprayer, laser land leveller etc shall be done after ensuring economic viability and demand in the area.
- For bulldozers, JCBs, Well- Boring equipment etc: Any individual or group of individuals jointly holding ownership of minimum of 5 acres of perennially irrigated agricultural land. Farmer should have proper scope for utilization of assets and based on economics should be in a position to conveniently repay loan.
- For repair/renovation of Farm Machinery:- Any borrower owning farm machinery in his name and, where agriculture land is mortgaged with the Bank is eligible for term loan for repair/renovation up to maximum of Rs. 50,000/- based on the estimate of authorized dealer.
- For Combine Harvester: Any individual or group of individuals holding land jointly should have a land holding owned by them minimum of 5 acres of perennially irrigated agricultural land. Farmer should have proper scope for utilization of assets and based on economics should be in a position to conveniently repay loan.
- Yielding estates and should be in a position to rejuvenate the estate proposed to be purchased.
- The intending borrowers should have with satisfactory past dealing with the Bank.
- The purchaser should be experienced in the line, financially should and should be in a position to bring in margin and service the debt.
- The intending buyers should qualify the respective State Government norms of being an agriculturist / satisfy the income criteria stipulated by the State Government.
- The estate should preferably be a neglected one. The estate should have potential form realizing higher yields. The estate should have the potential to absorb substantial credit for developmental activity.
- The total land holding including the land to be acquired should be within the land ceiling norms of the respective State.
Any person engaged in agriculture or allied activities as well as persons engaged in activities permitted by GOI/RBI to be classified under agriculture. The applicant should satisfy the KYC guidelines & loan shall be given based on declaration. Additionally, proof of pursuing the activity to be given for loans above Rs.1 lakh.
The purpose of the loan shall be for any one/various purposes for meeting the farm activity related expenses, including that for allied activities. The loan assessment shall be based on Scale of finance for crop production and actual credit requirement by farmers for other purposes. This shall be based on the declaration of the farmers in the application. However the limit shall be limited to value of pledged Gold Jewellery /Gold coins etc as permitted by RBI less the stipulated margin. In case of Silver, the loan shall be extended against silver jewellery only due to difficulties in handling of silver articles other than jewellery.
Quantum of loan/Ceiling:
- To be based on the investment plan given by the farmer to be undertaken in the next 2-3 years.
- The plan may be a combination of investment / development activities relating to agriculture and allied activities.
- It shall be subject to 5 times of Annual income (current - pre development stage) of the farmer including allied activities or 50% of the value of land mortgaged which ever is lower, with a maximum Rs.20 Lakhs.
Eligibility condition under the scheme are as under:-
- The farmersâ land should have adequate source of water. In case any Public/ Government source is being used, water right certificate from the concerned authority should be produced. In case of wells they should have sufficient recouping capacity to irrigate area proposed to be brought under irrigation.
- He/She should own an economic land holding with a minimum of 10 acres. However, loans may be considered even if the benefiting area is less than 10 acres provided the farmer is able to sell surplus water.
- It is also possible that due to Technical limitation of solar pumpset that it can work at low Heads only (shallow water sources) and low capacity (2.50 HP pumpsets) & hence capacity to irrigate small area only (1- 2 Hectares) due to small discharge.
- In such cases it should be ensured that viability is ensured and projected DSCR is not less than 1.60.
In case of Cash Credit facility, margin in the form of stock may be 20% and against Book Debts may be 50%.where as in case of ODP facility for fresh cases, margin of 35% shall be applicable and for renewal where revaluation of property is not due, margin of 25% is required. In case of renewal, where revaluation of property is due margin of 35% on revalued property shall be applicable.
The scheme is being implemented on all India basis. A short term finance upto 9 months is available for seeking finance under the Warehouse Receipts issued by M/s National Bulk Handling Corporation (NBHC) and M/s Star Agriwarehousing & Collateral Management Limited (SACM). The range of services for Collateral Management and the fee & charges for these services are available in the agreement with these companies.