DMPQ: What is interest subvention scheme? Discuss its salient features

Interest subvention scheme was launched to make available agricultural credit for short term crop loans at an affordable rate to give boost to agriculture productivity and production in the country. The salient features of the scheme are as follows:

 

It provides concessional of 2% per annum for crop loans to farmers, upto Rs. 3 lakh at 7% rate of interest.

  • An additional interest subvention of 3 per cent per annum is available to the “prompt payee farmers.
  • Interest subvention will be available to Public Sector Bank, Private Sector Bank and to NABARD for providing concessional refinance to RRBs and Cooperative Banks.
  • The Scheme is provided for four segments namely;

o Interest subvention for short term crop loans.

o Interest subvention for post-harvest loans.

o Interest subvention under Deendayal Antyodaya Yojana – National   Rural Livelihoods Mission (DAY-NRLM).

o Interest subvention for relief to farmers affected by natural calamities.

 

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