Bank mentioned a modified interest subvention scheme on my crop loan. I want to know what it covers and the limits.
What is the Modified Interest Subvention Scheme and which loans does it apply to?
OOmprakash Gupta7mo ago · 177 views
4 Answers
🌾Farmer.in Krishi TeamExpert ✓7mo ago
The Modified Interest Subvention Scheme is the framework through which short-term agriculture loans are made cheaper for farmers. It gives the lending bank an interest subvention so it can offer KCC crop loans, and also working-capital loans for animal husbandry and fisheries, at a reduced rate on amounts up to a notified ceiling. On top of that, prompt-paying farmers get a Prompt Repayment Incentive that further lowers the effective rate, which is how the much-quoted figure around 4 percent arises for those who repay within the prescribed period. The scheme also includes the special provision allowing small and marginal farmers to keep the concessional rate for a limited period after harvest if they store produce against a warehouse receipt. The subvention and incentive percentages, the eligible ceiling and the prompt period are revised by the government from time to time, so ask your bank for the current MISS rates and conditions that apply to your loan.
OOmprakash Sharma7mo ago
Bank ne mere crop loan par MISS ke tahat sasta byaj diya. Time par bharne par prompt repayment incentive bhi mila jisse rate aur kam ho gaya. Apne loan par current MISS rate aur ceiling bank se confirm kar lo.
RRamnaresh Gupta6mo ago
The useful part for me was that the same scheme covers the post harvest warehouse receipt benefit for small farmers, which I used to hold my stock at the cheap rate. The percentages change, so ask your bank what applies this year to your loan.
JJitendra Mishra6mo ago
One pitfall, the subvented rate only covers amounts up to the notified ceiling and within the prompt period. Anything above or late goes to the normal rate. Keep your drawing within the limit and repay on time to get the full benefit.