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Top 8 Best Agricultural Loans in India

India is an agriculture-based country. The economy of our country heavily depends on agriculture and allied industries. However, agricultural activity demands loans and financial assistance for several different purposes. In India, there are several banks and financial institutions that provide funding for agricultural businesses. Here we list down the top banks that provide agricultural loans in India.

What are Agricultural Loans?

An agricultural loan is a type of financial assistance provided by banks, financial institutions, or government agencies to individuals, farmers, or entities engaged in agricultural activities. These loans are specifically designed to meet the funding requirements of agricultural operations, including crop cultivation, livestock farming, agribusiness ventures, and rural development projects.

Agricultural loans can be used for various purposes within the agricultural sector. It includes purchasing seeds, fertilizers, pesticides, agricultural equipment, machinery, and livestock, or for investment in farm infrastructure and irrigation systems. Additionally, these loans may also cover expenses related to land acquisition, farm expansion, working capital needs, and marketing activities.

8 Banks Providing Agricultural Loans in India

1. State Bank of India (SBI)

SBI is one of the largest public sector banks in India and offers a wide range of agricultural loan products tailored to the needs of farmers. These loans include Kisan Credit Card (KCC), Farm Mechanization Loan, Dairy Loan, and Agri Term Loan, among others. SBI provides competitive interest rates, flexible repayment options, and convenient loan processing for farmers across the country.

Features:

  • Flexible Loan Amount: SBI offers agricultural loans with flexible loan amounts tailored to the specific needs of farmers, ranging from small-scale to large agricultural projects.
  • Competitive Interest Rates: The bank provides competitive interest rates on agricultural loans, making them affordable for farmers across different regions.
  • Various Loan Products: SBI offers a comprehensive range of loan products including Kisan Credit Card (KCC), crop loans, farm mechanization loans, dairy loans, and more, catering to diverse farming requirements.
  • Flexible Repayment Options: Farmers benefit from flexible repayment options, allowing them to choose repayment schedules that align with their cash flow patterns and seasonal income fluctuations.
  • Quick Loan Processing: SBI ensures quick and hassle-free loan processing, enabling farmers to access funds promptly for their agricultural activities.

Read: How To Get Agriculture Loan in India

2. Punjab National Bank (PNB)

PNB is another leading public sector bank in India with a strong presence in rural and agricultural areas. The bank offers various agricultural loan schemes such as Kisan Credit Card, Crop Loan, Farm Mechanization Loan, and Warehouse Receipt Financing, catering to the diverse needs of farmers. PNB provides hassle-free loan processing, quick disbursal, and personalized assistance to farmers seeking financial assistance.

Features: 

  • Competitive Interest Rates: PNB provides agricultural loans at competitive interest rates, ensuring affordability for farmers across different regions.
  • Collateral-Free Loans: The bank offers collateral-free financing options for small and marginal farmers, making agricultural loans more accessible to a wider segment of the farming community.
  • Insurance Coverage: PNB includes insurance coverage against crop failure and other risks, providing financial protection to farmers against unforeseen events.
  • Customer Support: PNB offers dedicated customer support services to assist farmers with loan inquiries, application procedures, and other banking-related queries.
  • Digital Access: The bank provides digital access to agricultural loan services through online platforms and mobile applications, enhancing convenience and accessibility for farmers.

3. Bank of Baroda (BOB)

BOB is a prominent public sector bank that provides comprehensive agricultural finance solutions to farmers and agripreneurs. The bank offers specialized loan products such as Baroda Kisan Credit Card, Baroda Dairy Loan, Tractor Loan, and Agri Term Loan to support agricultural activities. BOB focuses on delivering affordable interest rates, flexible repayment terms, and superior customer service to farmers across India.

Features:

  • Wide Range of Loan Products: BOB offers an extensive array of agricultural loan products, including Kisan Credit Card (KCC), crop loans, farm mechanization loans, and warehouse receipt financing, catering to diverse farming requirements.
  • Competitive Interest Rates: The bank provides competitive interest rates on agricultural loans, ensuring affordability and cost-effectiveness for farmers.
  • Technical Assistance: BOB offers technical assistance and advisory services to farmers, helping them adopt modern farming practices, enhance productivity, and optimize resource utilization.
  • Insurance Coverage: The bank offers insurance coverage for agricultural loans, providing farmers with financial protection against crop losses, natural calamities, and other risks.
  • Customer-Centric Approach: BOB prioritizes customer satisfaction and offers personalized assistance to farmers, addressing their queries and concerns related to agricultural financing.

4. ICICI Bank

ICICI Bank is one of the largest private sector banks in India that offers agricultural loans to farmers and rural entrepreneurs. The bank provides a range of loan products such as Agri Term Loan, Kisan Credit Card, Dairy Loans, and Agri Gold Loan, designed to meet the diverse financing needs of agricultural activities. ICICI Bank leverages technology to offer digital loan processing, doorstep service, and customized financial solutions to farmers.

Features:

  • Various Loan Products: ICICI Bank offers a range of loan products such as Kisan Credit Card, agri term loans, dairy loans, and gold loans, addressing different agricultural financing needs.
  • Quick Loan Processing: The bank ensures quick loan processing with minimal paperwork, enabling farmers to avail funds expeditiously for agricultural activities.
  • Technical Assistance: ICICI Bank provides technical assistance and advisory services to farmers to enhance their agricultural productivity and efficiency.
  • Insurance Coverage: The bank offers insurance coverage for agricultural loans, providing farmers with financial security against crop losses and other risks.
  • Customer Support: ICICI Bank offers round-the-clock customer support services to address farmers’ queries and concerns related to agricultural lending.

5. Axis Bank

Axis Bank is another prominent private sector bank that offers agricultural loans to farmers and agribusinesses. The bank provides various loan schemes such as Kisan Credit Card, Agri Term Loan, Livestock Loan, and Farm Equipment Loan to support farm operations and rural development. Axis Bank emphasizes customer-centricity, transparency, and innovation in its agricultural lending practices.

Features:

  • Flexible Loan Amount: Axis Bank offers agricultural loans with flexible loan amounts to meet the diverse financial needs of farmers engaged in different agricultural activities.
  • Competitive Interest Rates: The bank provides competitive interest rates on agricultural loans, ensuring affordability and cost-effectiveness for farmers.
  • Digital Access: Axis Bank offers digital access to agricultural loan services through its online banking portal and mobile app, enabling farmers to apply for loans and manage their accounts conveniently.
  • Customer Support: The bank provides personalized customer support to assist farmers with loan inquiries, documentation requirements, and other banking services.

6. HDFC Bank

HDFC Bank is one of the leading private sector banks in India that provides agricultural finance solutions to farmers and rural communities. The bank offers a range of loan products such as Kisan Gold Card, Kisan Dhan Vikas e-Kendra, Dairy Loan, and Agri Term Loan to meet the diverse needs of agriculture-related activities. HDFC Bank focuses on delivering competitive interest rates, simplified loan processing, and personalized advisory services to farmers.

Features:

  • Customized Loan Solutions: HDFC Bank offers customized loan solutions tailored to meet the specific requirements of farmers, including crop loans, farm mechanization loans, and Kisan Gold Cards.
  • Quick Disbursal: The bank ensures quick disbursal of agricultural loans, allowing farmers to access funds promptly for their farming activities.
  • Insurance Coverage: HDFC Bank provides insurance coverage for agricultural loans, offering protection to farmers against crop failures, natural calamities, and other unforeseen events.
  • Digital Access: HDFC Bank offers digital banking services for agricultural loans, allowing farmers to apply for loans, make repayments, and access account information online.

7. NABARD

The National Bank for Agriculture and Rural Development (NABARD) is a specialized financial institution that provides refinance and development support to banks for agricultural lending. NABARD collaborates with commercial banks, cooperative banks, and regional rural banks to channel credit to farmers through various loan schemes and programs. NABARD plays a crucial role in promoting rural credit and agricultural development in India.

Features:

  • Refinance and Development Support: NABARD plays a pivotal role in agricultural financing by providing refinance and development support to banks and financial institutions for lending to farmers and rural entrepreneurs.
  • Credit Facilities: NABARD extends credit facilities to commercial banks, regional rural banks (RRBs), and cooperative banks for on-lending to farmers through various agricultural loan schemes and programs.
  • Priority Sector Lending: NABARD mandates banks to allocate a certain percentage of their loan portfolio to priority sectors, including agriculture and rural development, ensuring adequate credit flow to farmers and rural communities.
  • Technical Assistance: NABARD offers technical assistance, capacity building, and training programs to banks, farmers, and other stakeholders in the agricultural sector, promoting the adoption of best practices and modern technologies for enhanced productivity and sustainability.
  • Promotion of Rural Infrastructure: NABARD finances rural infrastructure projects such as irrigation systems, rural roads, warehousing facilities, and agro-processing units, facilitating agricultural development and value chain enhancement in rural areas.
  • Rural Innovation Fund (RIF): NABARD operates the Rural Innovation Fund to support innovative projects and initiatives aimed at addressing rural development challenges, fostering entrepreneurship, and promoting rural livelihoods.
  • Financial Inclusion Initiatives: NABARD promotes financial inclusion among rural populations by supporting initiatives such as self-help groups (SHGs), microfinance institutions (MFIs), and rural cooperative societies, empowering marginalized communities and facilitating access to credit and financial services.

Related: Mudra Bank Loan Details In India

Indian Bank

IB has a wide range of schemes for agriculturalists such as the Swarojgar Credit Card, Gramin Mahila Sowbhagya Scheme, Kisan Bike Loan Scheme, Yuva Kisan Vidya Nidhi Yojana, and Indian Bank Kisan Card Scheme. Some of the popular types of Agricultural loans from the Indian Bank are Agricultural Godowns/ Cold Storage, Tractor Purchases, Farm Machinery, Kishan Credit Cards, Agricultural Jewel Loan Schemes, and many more.

Features:

  • Tailored Loan Products: Indian Bank offers a range of tailored loan products specifically designed to meet the financing needs of farmers and agribusinesses. These include crop loans, Kisan Credit Card (KCC) scheme, agricultural term loans, and farm mechanization loans.
  • Competitive Interest Rates: The bank provides agricultural loans at competitive interest rates, ensuring affordability and cost-effectiveness for farmers across different regions.
  • Quick Loan Processing: Indian Bank prioritizes quick and hassle-free loan processing for agricultural borrowers, ensuring timely access to funds for farm activities and seasonal requirements.
  • Transparent Loan Terms: Indian Bank maintains transparent loan terms and conditions, providing clarity and fairness in loan agreements and fostering trust and confidence among borrowers.

Frequently Asked Questions

Who is eligible to apply for an agricultural loan?

Eligibility criteria for agricultural loans vary among banks and financial institutions. Typically, individuals involved in agricultural activities, farmers, tenant farmers, sharecroppers, agricultural labourers, self-help groups (SHGs), and agribusiness enterprises are eligible to apply for agricultural loans.

What are the documents required to apply for an agricultural loan?

The documents required to apply for an agricultural loan may include identity proof, address proof, land ownership documents, income proof, agricultural land records, soil health reports, project reports, and other relevant documents as per the bank’s requirements.

What are the types of agricultural loans available in India?

Agricultural loans in India come in various forms, including crop loans, farm mechanization loans, dairy loans, poultry loans, agricultural term loans, warehouse receipt financing, and the Kisan Credit Card (KCC) scheme, catering to different farming needs and requirements.

What is the interest rate charged on agricultural loans in India?

The interest rate charged on agricultural loans in India varies among banks and financial institutions. Banks often offer competitive interest rates on agricultural loans, which may be subsidized by the government under certain schemes.

Are there any government subsidies or schemes available for agricultural loans?

Yes, the Government of India and state governments offer various subsidies, grants, and schemes to promote agricultural lending and support farmers. These may include interest rate subsidies, loan waivers, debt relief schemes, and credit guarantee programs aimed at enhancing access to agricultural credit and reducing the financial burden on farmers.

What is the repayment period for agricultural loans?

The repayment period for agricultural loans varies depending on the type of loan and the borrower’s financial capacity. It may range from short-term loans with repayment periods of one crop season to long-term loans with repayment periods of several years, depending on the nature of the agricultural activity and the loan amount.

Is collateral required for agricultural loans in India?

Collateral requirements for agricultural loans in India vary among banks and financial institutions. While some loans may be offered without collateral for small and marginal farmers, larger loans may require collateral security such as land, crops, or other assets, depending on the loan amount and the borrower’s creditworthiness.

How can I apply for an agricultural loan in India?

To apply for an agricultural loan in India, interested individuals can visit their nearest bank branch or apply online through the bank’s website. They will need to fill out the loan application form and submit the required documents for loan processing and approval.

What support services are available for agricultural loan borrowers?

Many banks and financial institutions offer support services such as technical assistance, training programs, crop advisory services, and insurance coverage to agricultural loan borrowers to enhance their agricultural productivity, mitigate risks, and improve their overall farming operations.

About Next What Business Research Team

The Editorial Staffs at NextWhatBusiness is a team of Business Consultants with years of experience in small and medium-scale manufacturing and service-based businesses.