SBI has two bank loan schemes for Dairy related agricultural projects. The first one named -SBI Scheme For Dairy Societies- aims to provide finance for creating infrastructure like Construction of Milk house or Society office, Purchase of Automatic milk collection system, transport vehicles, Bulk chilling unit; and the second named SBI Dairy Plus Agriculture loan scheme to finance milk producing members of AMUL pattern societies recognized private milk dairies posting profit in the past two years.
1. SBI Agriculture loan scheme for Financing Dairy Societies
SBI Scheme For Dairy Societies aims to provide finance for creating infrastructure like Construction of “milk house or society office”, Purchase of “Automatic milk collection system”, transport vehicles, Bulk chilling unit.
Loan Eligibility for Dairy Societies
Society should have ‘A’ grade milk societies – registered & affiliated to district milk union, no adverse remarks in the audit report of previous 2 years, supplying 1000 lit/day to milk union, audited balance sheet for at least previous 2 years, earning pre-tax profits for the last two years, borrowing powers as per bye-laws of the Society.
Classification of Loan for Dairy Societies
Included in Indirect agriculture finance and / or Agricultural term loan (ATL).
Limit of Loan for Dairy Societies
Maximum - 4 times the average profit of previous 2 years maximum Rs 10.00 lacs. Milk house or society office Rs. 2 lakh, Automatic milk collection system Rs. 1 lakh, Milk transportation Rs. 3 lakh, Chilling Unit Rs. 4 lakhs.
Margin of Loan for Dairy Societies
Margin money shall be 15% of the total loan amount
ROI /Documents
As applicable to ATL.
DSCR: Min. 1.75
Security
- Primary: Hypothecation of assets.
- Collateral: Mortgage of landed property (or) Guarantee of milk union. Letter of undertaking from milk union to deduct and pay bank the amount till liquidation of loan.
Repayment
Repayable in 5 years with a gestation of 6 months, with monthly installments.
2. SBI Agriculture Loan Scheme for Financing Dairy Units (Dairy Plus)
SBI Dairy Plus Agriculture loan scheme to finance milk producing members of AMUL pattern societies recognized private milk dairies posting profit in the past two years.
Purpose of SBI Dairy Plus Agriculture loan scheme
Construction of dairy shed Purchase of quality milch animals, milking machine, chaff cutter or any other equipment required for the purpose.
Eligibility for SBI Dairy Plus Agriculture loan scheme
Individual member of Amul Type society, age below 65 years with min. Individual Dairy < 10 animals min 0.25 acre land per 5 animals for growing feed & able to procure balance locally, > 10 animals 1 acre own or lease land per 5 animals.
Limit of SBI Dairy Plus Agriculture loan scheme
A Term loan of Maximum Rs.5 lacs. A working capital @ Rs.2500/- per animal per year may be sanctioned. Min DSCR: 1.75.
Margin of SBI Dairy Plus Agriculture loan scheme
Loans upto Rs. 50,000/- : Nil. Loans above Rs. 50,000/- and upto Rs.5 lacs: 10%
Security
- Primary: hypothecation of assets.
- Collateral: upto Rs. 1.00 lac : Nil. Over Rs.1 lac - Mortgage of landed property (or) third party guarantee worth for loan amount (or) group guarantee of other 2 dairy farmers.
Repayment of SBI Dairy Plus Agriculture loan scheme
5 Years in monthly instalments with Gestation period – 6 months.
Rate of interest of SBI Dairy Plus Agriculture loan scheme
As applicable to direct agricultural loans (ATL).
Other terms
Minimum yield criteria: Buffaloes – 7 lit/day (lactation average) Cow – 8 lit/day (lactation average). Fodder cultivation can be financed as per scale of finance. Payment to the bank directly by the society. Milk union operation & milk route facility are essential.