Agricultural Loans

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Agricultural Loans are generally provided by Banks as an initiative to support the community as a whole and as part of some of the government schemes to provide farmers with operating income at a very affordable interest rate.

Farmers use this amount to buy seeds, machinery, fertilizers or to meet the day to day cost associated with farming. Also this loan is utilized by farmers to create irrigation facilities and to harvest the crop incase rainfall does not happen in that particular crop.

Repayments are done by farmers once the crop is sold in market which is sometimes bought by the government as an initiative to support farming and to stop farmers from leaving villages and migrating to Cities in search of new employment that does not require farming.

Agricultural Loans were initiated to continue growth of basic necessities such as rice, paddy and vegetables and to stop migration of farmers from villages to cities.

Prior to the start of this loan, farmers were exploited by landlords and were forced to serve them as bonded labourers and even generations to come as the interest charged by landlords was exponentially high and the repayments towards the loan would be deducted against the interest only and the principal used to be outstanding forever.

The moment these loans were initiated, migration to cities was stopped to an extent and the required support was provided to farmers which will definitely help in increasing production.