Farmer’s Guide for Taking Agricultural Loans and Other Financing Options
When it comes to agriculture, then India is a country that still has a major output arriving from the agrarian economy. A significant part of the population is still engaged in farming and is part of the economy that helps in nation-building.
Certain types of crop loans are available to facilitate the work of farmers, providing them with the right resources to meet their requirements. There are agricultural loans that can provide financial assistance or empower farmers so that they can invest in equipment and build the infrastructure to succeed in farming activity.
There are DSA apps that can help a farmer get the right agricultural role, and through that, one can invest in their field, which can help the farmer yield higher returns from their crop.
In this blog, we will look into different types of agricultural loans and how one can avail and through that one can arrive to take that loan.
- Crop Loans With Kisan Credit Card
Kisan Credit Card is a special financial option designed for farmers to meet their short-term financing needs. It can be used to meet the farm’s obligations near the cultivation season and repaid after the harvesting season.
In the Kisan Credit Card, a fixed limit amount has been set for the farmers to use during the farming season at a subsidized rate. This allows the farmer to take a small amount as a loan that they can easily repay after the harvesting season.
- Gold-Backed Agricultural Loan
Apart from KCC, other types of agricultural loans are essential for a farmer to know as each option offers different types of loan offers. For example, the gold-backed loan allows the farmer to take a loan of a higher amount with low interest since the gold backs the loan.
Here, a person can get the capital for the entire farming season, gather the seeds, fertilizers, and pesticides, and secure the farming practices that allow the farmer to maintain the entire stock of the farming unit. Later, they can repay the loans and get back the loan that worked as a mortgage.
- Opting Farm Mechanization Loans
There are types of loans that one can use to bring machines to the firm. Through that, one can gather modern machines and equipment, which will make the process fast and effective.
For example, there are tractor loans that a person might need to increase the productive output of the field. A tractor can help a person do the work of the field in the right manner and is also the right tool for ploughing the field.
- Loan for Land Purchases
There are loan options for farmers who want to purchase land. The government has arranged funds at low interest that the PSU banks can distribute. A farmer might want to shift to a crop that has a higher yield, and for that, they need land, which they can get from the banks that offer microfinance loans.
Many farmers in our country still work as farmers in someone else’s field, and they are the most vulnerable group as their income depends on multiple factors. They can’t even depend on their produce as they don’t own the field. There are personal loan DSAs that can help the farmers get the right loan amount for the land purchase.
One can also keep their land as a mortgage to lower the interest of the loan, allowing them to get the loan at a much lower rate.
- Loan for Livestock
There are several loan options for maintaining livestock. Under the agriculture wing, there are loan options for allied agricultural activities such as maintaining livestock.
Here, a person needs to invest in the feed, or it can be used for procuring necessary items that are required for maintaining livestock. These loans also offer flexible repayment schedules, which are effective for a farmer to get revenue from their livestock and then cover up all the previous debts.
