SBI Agriculture Loan For Organic Farming And Organic Input Produce

1. Capital Investment Subsidy Scheme For Commercial Production Units Of Organic Inputs Under National Project On Organic Farming

Objective of SBI's Capital Investment Subsidy Scheme For Commercial Production Units Of Organic Inputs Under National Project On Organic Farming is to promote organic farming in the country by making available the organic inputs such as biofertilisers, vermicompost and fruit & vegetable waste compost and thereby better return for the produce.

Eligibility: New as well as existing units (for expansion / renovation) engaged in the production are eligible under the scheme e.g Biofertilisers Unit, Vermiculture Hatcheries, Fruit and Vegetable Waste Compost Unit.

Pattern of assistance: TERM LOAN- Owner's contribution 25%, Subsidy from Government of India 25% subject to the maximum ceiling, Bank loan 50%.

Project cost: Project cost can include the cost of land and land development, civil works, equipments etc. The value of land should not exceed 10% of the project cost. The cost of land computed in the project cost can be reckoned towards the margin money required to be met by the enterprise.

Subsidy: 25% of the project cost max 1.50 lac for Vermiculture Hatcheries, 20 lac for Biofertilisers Unit, 40 lac for Fruit and Vegetable Waste Compost Unit.

ROI: As applicable to Ag. advances

Security: The security will be as per norms prescribed by RBI from time to time.

Repayment: 8 years with a grace period of 1 year for Vermiculture Hatcheries, 10 years with a grace period of 2 years for Biofertilisers Unit & Fruit and Vegetable Waste Compost Unit.

SBI Agriculture Loan For Organic Farming And Organic Input Produce

2. Financing Of Organic Farming

Objectives of Financing Organic Farming is to prevent degradation of precious arable land and pollution of water from the abuse of chemical fertilizers/pesticides/insecticides and to capture the branded domestic retail and export market opportunities.

Eligibility: All individual farmers i.e., our existing borrowers and creditworthy new borrowers, JLGs engaged in crop production activity. The prospective borrower(s) shall own individually or collectively min. 4 acres of irrigated land / 10 acres of dry (rain fed) land.

Classification: Direct Agriculture

Quantum of Loan: (ATL & KCC) as per bank’s prescribed norms. The conversion period from conventional to organic farming is about 3 years. Gross DSCR of 1.75 to be maintained.

Margin (for ATL): 20% of the project cost - own contribution or subsidy received.

Gestation period: 3 years

Repayment: Overall repayment period will be up to 9 years including 3 year gestation period.

Subsidy: From National Horticulture Mission (NHM): @ Rs. 10,000/- per hectare subject to a limit of 4 hectares per beneficiary.

Rate of Interest: Card Rate.

Security:

  1. Primary: Hypothecation of assets created & crops to be raised.
  2. Collateral: Mortgage of land OR any other readily realizable liquid/ immovable security of adequate value for Individual Farmers. Only mutual guarantee for JLGs (ATL & ACC Max. Rs. 50,000/- per member. Max. 10 members / group).
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