Car loan lender State Bank of Mysore, a subsidiary of State Bank of India has launched an excellent crop loan scheme for farmers. In this scheme, the farmers will have to pay an interest of just 2%. A senior official of the bank said this is the first instance of any bank charging such a cheap rate of interest.
At the time of introduction of the scheme, Dilip Mavinkurve, MD of SBM said, “Last year was not a good year for our farmers as Karnataka experienced both very dry conditions and floods in quick succession. In order to encourage and motivate farmers to avail of crop loans, we have formulated the scheme called Mysore Bank Prathiphala Yojane to offer the lowest rate of interest on farm loans.”
Under the scheme an extra rebate of 1% per year will be given for timely repayment on all the loans. The central government has already offered a discount of 2% on interest on sums up to Rs 3 lakh.
The bank plans to give extra loans amounting to Rs 1500 crore in this scheme this year. Presently SBM’s agriculture loans are around Rs4,200 crore from which Rs1,200 crore is kept for production credit and Rs3,000 crore for investment credit.
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