Interest subvention on short term crop loans to continue: RBI

These restructured loans may attract normal rate of interest from second year onwards

In a relief to farmers, Reserve Bank of India has notified the banks that the interest subvention of 2% will continue to be available to banks for the first year on the restructured amount.

These restructured loans may attract normal rate of interest from the second year onwards as per the policy laid down by the RBI.

This was approved by the Cabinet in December last year.

Farmers get loans at a concessional rate of interest on short term crop loans and banks later get the money from the government.