Agriculture loans

Notable Features of Farm Mechanisation Loans:

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  Eligibility – Offers to farmers who own land. Different banks have various eligibility clauses like Canara Bank offers tractor loans only to farmers who own at least 6 acres of perennially irrigated land or 12 acres of dry land. 
  
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  The loan amount ranges from Rs. 30,000 to Rs. 30 lakhs and varies from lender to lender. 
  
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  It can be either secured or unsecured, depending on the lender.
  
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  The rate of interest starts from 10.5%. 
  

Besides these five major types of agriculture loans, there are several other categories like horticulture loans, forestry loans, etc. 
Agriculture Loans FAQs

1. 
   What are the eligibility criteria for agriculture loans in India?
   

Agriculture loans are offered to individual farmers, groups of farmers, tenant farmers, sharecroppers, oral lessees, and other individuals engaged in agri-related activities. The actual eligibility criteria depend on the type of loan and the lender.

2. 
   What are the documents required for agriculture loans in India? 
   

The list of documentation required for agriculture loans is minimal. Most schemes need only the essential paperwork, to make the entire process hassle-free and convenient for farmers.
The basic list of documentation include:

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  Duly filled application form
  
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  Photo identity proof
  
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  Address proof 
  
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  Proof of land ownership, purchase receipts, etc
  

3. 
   Can agriculture loans be used to purchase land? 
   

Yes. The purchased plot should be agricultural and located within a radius of 5 km of the farmer's house/village.

4. 
   Is the collateral required for agricultural loans?
   

To reduce the burden of farmers, the government of India has relaxed the norms for agricultural loans. As per RBI norms, agrarian loans up to Rs. 1 lakh do not require any collateral or security. For loans above Rs. 1 lakh, the security requirements are set by individual lenders.

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