The Reserve Bank of India has announced an increase in the limit for collateral-free agricultural loans from 1.6 lakh to 2 lakh rupees. It will be effective from 1st January next year.
In a statement, the Agriculture and Farmers Welfare Ministry said that this decision acknowledges the impact of inflation and the increasing cost of agricultural inputs on farmers.
Akashvani correspondent reports that the banks have been instructed to provide widespread publicity to ensure maximum outreach and awareness among farmers and stakeholders of their operational area.
The move will provide enhanced financial access to farmers, ensuring they have sufficient resources to meet their operational and developmental needs.
It will enhance credit accessibility, particularly for small and marginal farmers, who benefit from reduced borrowing costs and the removal of collateral requirements.
The initiative will also increase the uptake of Kisan Credit Card loans allowing farmers to invest in agricultural operations and improve their livelihoods.
