Govt extends crop loan interest benefits for farmers till May 31

The government has extended the benefit of 2 per cent interest subvention (IS) to banks and 3 per cent prompt repayment incentive (PRI) for all crop loans up to Rs 3 lakh given by banks

Farmers will get time until May 31 to repay their short-term crop loans while they retain the benefit of interest subvention and incentives for timely repayment, PTI reported on Monday, attributing the government decision to help people during a national lockdown to prevent the spread of the coronavirus .

The government has extended the benefit of 2 per cent interest subvention to banks and 3 per cent prompt repayment incentive (PRI) for all crop loans up to Rs 3 lakh given by banks and that are due or will become due between March 1 2020 and May 31 this year.

"...due to restrictions on movement of people and difficulty in timely sale and receipt of payment of their produce, farmers may be facing difficulties in repayment of their short term crop loans falling due during this period,” an agriculture ministry officer told Economic Times, referring to the lockdown.

Last week, the government announced an economic stimulus package worth Rs 1.7 trillion to help millions of low-income households cope with the 21-day lockdown. 

The package was announced two days after Prime Minister Narendra Modi ordered the lockdown to protect the country’s 1.3 billion people from coronavirus. That led to supply constraints for essential items and panic buying, leaving the poor and daily laborers most vulnerable.