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 Farm credit : Loans to individual farmers [including Self Help Groups (SHGs) or Joint

1.  Farm credit : Loans to individual farmers [including Self Help Groups (SHGs) or Joint Liability Groups (JLGs), i.e. groups of individual farmers, provided banks maintain disaggregated data of such loans] and Proprietorship firms of farmers, directly

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 Farm credit : Loans to individual farmers [including Self Help Groups (SHGs) or Joint

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  2.  Farm credit : Loans to individual farmers [including Self Help Groups (SHGs) or Joint Liability Groups (JLGs), i.e. groups of individual farmers, provided banks maintain disaggregated data of such loans] and Proprietorship firms of farmers, directly engaged in Agriculture and Allied Activities, viz., dairy, fishery, animal husbandry, poultry, bee-keeping and sericulture.  Agriculture infrastructure i) Loans for construction of storage facilities (warehouses, market yards, godowns and silos) including cold storage units/ cold storage chains designed to store agriculture produce/products, irrespective of their location. ii) Soil conservation and watershed development. iii) Plant tissue culture and agri-biotechnology, seed production, production of bio- pesticides, bio-fertilizer, and vermi composting. For the above loans, an aggregate sanctioned limit of ₹100 crore per borrower from the banking system, will apply. 2

  3. Ancillary activities (i) Loans up to ₹5 crore to co-operative societies of farmers for disposing of the produce of members. (ii) Loans for setting up of Agriclinics and Agribusiness Centres. (iii) Loans for Food and Agro-processing up to an aggregate sanctioned limit of ₹100 crore per borrower from the banking system. (iv) Loans to Custom Service Units managed by individuals, institutions or organizations who maintain a fleet of tractors, bulldozers, well-boring equipment, threshers, combines, etc., and undertake farm work for farmers on contract basis. (v) Bank loans to Primary Agricultural Credit Societies (PACS), Farmers’ Service Societies (FSS) and Large-sized Adivasi Multi-Purpose Societies (LAMPS) for on-lending to agriculture. (vi) Loans sanctioned by banks to MFIs for on-lending to agriculture sector as per the conditions specified in paragraph 19 of these Master Directions. (vii) Outstanding deposits under RIDF and other eligible funds with NABARD on account of priority sector shortfall. 3

  4. Small Farmer- Land holding up to 2.5 acre of wet land or 5 acres of dry land. Marginal Farmer- Land holding up to 1.25 acre of wet land or 2.5 acres of dry land. Agricultural labourer- Land holding up to 0.5 acre of land or having a home-stead; should have income of more than 50% by way of agricultural wages. 4

  5. Eligibility: i. All farmers-individuals/Joint borrowers who are owner cultivators; ii. Tenant farmers, Oral lessees and Share Croppers etc; iii. SHGs or Joint Liability Groups of farmers including tenant farmers, share croppers etc. Fixation of limit : Other than Marginal farmers: KCC limit (Maximum Permissible Limit) shall be sanctioned based on the short term loan requirement (For every successive years (2nd, 3rd, 4th,and 5thyear), the limit will be stepped up @10%.(short term credit limit sanctioned for 5th year will be about 150% of the first year limit allowed to farmers). SoF(Scale of Finance): This will be decide by the District level Technical Committee (DLTC) of the respective district and concern Lead Bank is advised to all the Bank. 5

  6. Nature of account : KCC will be in the nature of revolving account. Credit balance in the account will be eligible for interest at savings bank rate. Validity: 5 years, subject to annual review. Disbursement: KCC borrowers shall be issued an ATM cum Debit card (State Bank Kisan Card), to enable them to withdraw from KCC accounts from ATMs of our SBI group, in addition to the disbursements at branches. 6

  7. SN Cropping Pattern Crop Cultivation period(Loan Disbursement Period) Repayment Due Date (fixed) (which shall also be the renewal date) NPA dates as per extant RBI guidelines. 1 Kharif Crop (mono) 1stApril to 30thSeptember 31stMay 1stJune after 24 months from due date. 2 Rabi Crop (mono) 1stOctober to 31stMarch 31stJuly 1stAugust after 24 months from due date. 3 Double/Mul tiple crops Kharif & Rabi Seasons 31stJuly 1stAugust after 12 months from due date. 4 Long term crops All around the year 12 months (from the date of first disbursement) After 12 months of due date 7

  8. AGRI INTEREST SUBVENTION  Interest Subvention @2% is made available on for short-term crop loans up to Rs. 3 lakhs per farmer.  The additional interest subvention of @3% p.a.(incentive) will be available from the date of disbursement of the crop loan up to the actual date of repayment by farmers or up to the due date fixed by the Bank for repayment of crop loan, whichever is earlier, subject to a maximum period of one year from the date of disbursement. ‘ ISSUE: Whether farmers availing production credit facilities of more than Rs. 3.00lac shall be eligible for subvention up to Rs. 3.00 lac (Example : If a KCC limit of Rs. 5.00lac is given, whether the farmer is eligible for interest subvention or not?) RBI Reply : RBI vide letter No.FIDD.FSD.NO.4719/05.02.001/ 2016-17 dated 24.05.2017 has advised that the subvention will be available on the amount up to Rs. 3.00 lakh and amount beyond it will be as per bank`s lending policy. 8

  9. AGRI INTEREST SUBVENTION Entries to be passed by the Branches : a) 2% Regular & Residual Interest Subvention : Dr BGL a/c No 4899215 (for disbursement during current year 2018-19) Cr Interest account (Agri) Dr BGL a/c No 4899216 (for disbursement during previous year 2017-18 – Residual Claim) Cr Interest account (Agri) b) 3% Additional Interest Subvention : Dr 4898262 BGL a/c (Addl Int Subvention receivable for PP farmers for disbursement FY 2017-18) Cr Loan a/c of the farmer. Certificates to be obtained : Following Certificates to be obtained from Statutory Auditors for Interest Subvention claim: For 2% Interest Subvention: 1. Certificate 12 A : (Residual period of repayment of the Loans disbursed during FY 2017-18) 2. Certificate 12B : (Claim for the loans disbursed during FY 2018-19) For 3% Interest Subvention: Certificate 13 : (Additional Intt. subv. for prompt repayment @ 3% for Short Term Production Loans disbursed during FY 2017-18 ) 9

  10. Giving access to Bankers of Land Records data. URL: http://kcc.gujarat.gov.in Giving tool to get first hand records of Loanee and non- Loanee farmers. Getting information of payment, repayment and outstanding amount information. Access to other information related to other bank or financial institutions lending which entered by each banker. Processes between initial sanction, renewal and disbursement

  11. URL: https://anyror.gujarat.gov.in/ 11

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  15. Objective: To enable farmers to meet their short term agricultural credit needs. Eligibility: All farmers–individuals /joint borrowers who are owner cultivators. Tenant farmers, Oral lessees and Share croppers, etc. Any person engaged in agriculture and allied activities as well as persons engaged in activities permitted by RBI to be classified under agriculture. Type of Loan: KCC/Over draft/ Demand Loan or ATL Crop loan requirement = SOF (Scale of Finance) x Crop grown acreage = ‘X’ Other than Crop loan purpose : Net weight of Gold ornaments X Advance value of Gold ornaments ( As advised by Precious Metal Department, Mumbai time to time) = ‘Y’ Min. – No Ceiling Max. - 25 lakh 15

  16. Assessment and Security valuation : Assessment of gold ornaments should be generally done by Cash Officer / Cash-In-Charge. For loans above Rs.50,000/- ornaments are to be assessed by reputed gold appraiser, specially identified for this purpose for its quality and value. MULTI PURPOSE AGRI GOLD LOAN (NONINTEREST SUBVENTION) Purpose : To meet the short term production / investment credit needs of a. the farmers, engaged in agriculture, cultivating own and /or leased land or engaged in cultivation of crops. b. Farmers in allied activities like Dairy, Poultry, Fisheries, Piggery, Sheep, etc. c. entrepreneurs and famers who needs investment credit for acquiring farm machinery, undertaking land development, irrigation, horticulture, transportation of Agri produce, etc d. All other farming activities which are permitted to be classified under agriculture as per RBI/GOI/NABARD guidelines and not covered under the Agri interest subvention scheme. 16

  17. REPAYMENT: a. Cash Credit / Overdraft: Like KCC, it is a running account for a period of 3 years, subject to review at annual intervals. b. Demand Loan / Term Loan: the repayment period of the loan should be fixed so as to coincide with the harvesting and marketing season. The total period will not generally exceed one year from the disbursement of the loan in the case of short-term loan / production credit and 36 months in other cases. PURITY OF GOLD CAN BE ASCERTAINED BY USING THE FOLLOWING METHODS. Touch stone method. Nitric Acid method. Specific gravity method. a) b) c) 17

  18.  Objective: To help farmers avoid distress sale of their produce. To offer the facility of loan against the stocks stored in farm houses, in addition to loan against warehouse receipts.  Eligibility: Farmers including group of farmers who have availed crop production loans from the branch or who have availed crop loan from other Bank or who have not availed crop loan from any Bank. Non-individuals like Partnership firms, Corporate etc engaged in agriculture and allied agri-activities.  Type of Loan: Demand Loan  Sanction limit: 60 % of values of produce, subject to a maximum limit of Rs. 50 lacs.  Margin: 40% 18

  19. Security: Loan sanctioned against goods stored in Farmer’s godown: Primary: Hypothecation of stocks. Collateral: Mortgage of land for loans above Rs.1,00,000/-. Loans sanctioned against Warehouse Receipts(WHR): Primary: Pledge of stocks. Collateral: No collateral is required for loans up to the maximum permitted limit of Rs.50 lacs under the scheme. Repayment: Loan has to be repaid within a maximum period of 12 months. 19

  20. Eligibility Farmer minimum land holding of 2.00 acres. All farmers- individuals/Joint borrowers who are owner cultivators. Purpose To meet the cost of purchase of Tractor (including insurance + registration charges) Quantum of loan: 100% The total cost of the tractor including insurance and registration charges (As per the dealer net price invoice obtained from reputed dealer of tractors of the approved tractor companies for the approved models)

  21. Margin Minimum 25% of the cost of tractor including insurance and registration margin have to be deposited in the form of TDR in the branch with Zero rate of interest and lien have to be marked on TDR for the entire tenure of tractor loan. charges. The Security • Primary: Hypothecation of Tractor purchased out of Bank’s finance. • Collateral: Lien on TDR accepted as a Margin Money. Repayment : There will two types of repayment period i.e. 48 months when the instalments are calculated on the basis of net loan (Loan – Margin kept in TDR) and 60 months when the instalments are calculated on the basis of total loan without netting. Frequency of instalment will be based on the total scores awarded under the parameters” Hiring potential + Percentage of income from allied activities under Tractor Credit Scoring Model will be adopted to determine the repayment schedule of the tractor loan. 21

  22.  To cater the growing requirement of agri borrowers who need hassle free loan processing /flexible repayment facility, we have designed ‘ Asset Backed Agri Loan (ABAL)’ loan product aimed at emerging Agri Business entrepreneurs SARFAESI complaint property and undertake farm and farm related activities including allied activities. who can offer adequate

  23. Eligibility  Progressive, literate and illiterate farmers with owned land/immovable property  Individuals/Joint, Sole Proprietary Concerns, Partnership firms.  Existing borrowers already availing credit facilities from our Bank..  Takeover of existing units from other Banks/FIs with satisfactory track record. ( Credit Information Report (CIR) to be obtained) Quantum of Loan  The need based assessment for the requirement of credit limits has to be done.  Loan amount will be fixed on the basis of 5 times of annual farm income/ non farm income from all verifiable sources or 65% of the value of land/building mortgaged whichever is less subject to:  Minimum Loan Amount: Rs.3.00 lakhs and above  Maximum Loan Amount : Rs.200 lakhs  Margin : 15-25%

  24. Eligibility security  SARFAESI Act compliant immovable property (Land and Building) pertaining to the individual/ proprietor/partners/ their near relatives. Facility/Repayment  Drop-line Overdraft (OD): Limits can be sanctioned for periods ranging from 12 months to 72 months with either equated reduction in limit or customized reduction in limit, depending upon the cash accruals.  Up to Rs.50 lacs Over Draft facility.  DP reduction date or instalment due date may be last working day of every month.  The drawing power shall be reduced monthly so as to have the overdraft liquidated at the end of the period.  Regular transactions are permitted up to drawing power available.  No over drawings are permitted. Processing Charges - 1% of the loan limit.

  25. Security  Primary:  Hypothecation of standing/future crops and assets created out of bank loan.  Collateral:  Immovable Property (Land and Building) for value not less than 155% of the loan amount by way of first charge.  No Second Charge or Pari- Passu charge will be extended for other Bank/FI.  Property should be SARFAESI Act compliant. CERSAI verification registration shall also be made on the proposed collateral security.  Physical gold belonging to the applicant or the guarantor can be deposited with the Bank or  National Saving Certificates/ KVPS/ LIC Policies/Banks Fixed Deposits belonging to the applicant or the guarantor can be accepted

  26.  Eligibility: Farmers associated with the Society/Dairy for atleast2years No KCC default history with any Bank for the past 3years (if applicable).  Amount of Loan: Minimumpurchaseof4cattle (disbursalin2 installmentsover6months)  Margin & Collateral: 100%financing: No margin requirement  Interest earning cash deposit upto 10-25% required No collateral requirement up to Rs.3 lacs  Repayment: 5 years with a moratorium of 1month 26

  27. Activity covered under Minor Irrigation 1. Dug well / Bore well / Tube well, Electric Motor / Diesel Engine with pump set, Pipe line and pump house. 2. Purchase of Electric Motor / Diesel engine with pump set, Pipe line and pump house. 3. Laying of pipeline Activity covered under Micro Irrigation 1. Financing sprinkler irrigation system 2. Financing Drip irrigation systems. Margin : 15% to 25% of the project cost. Repayment:  Generally 5 to 13 years depending upon the cash flow and DSCR. First instalment will be due on harvesting / marketing of FIRST post development crop. 27

  28. Objective  To create scientific storage capacity in the rural areas to meet the requirements of farmers for storing farm produce.  To promote grading, standardization and quality control of agricultural produce to improve marketability.  To prevent distress sale of produce by farmers immediately after harvest by promoting pledge financing and marketing credit.

  29. ELIGIBLE BORROWERS :  Individuals / Farmers.  Proprietary and partnership terms.  Co-operatives, Agro-processing cooperative  societies.  Companies/ Corporations, Agro-Industrial  corporations.  Agricultural Produce Marketing Committees.  Group of Farmers/Growers.  NGOs/ Self Help Groups/Agro-Processing Corporations.

  30. OBJECTIVES:  To promote setting up of cold storage and reducing post harvest losses.  To create cold chain infrastructure from farm to the consumer.  To modernize/rehabilitate cold storages.

  31. ELIGIBLE ORGANISATIONS:  Individuals / Farmers, Group Farmers/ Growers, Companies, NGOs, Partnership / Proprietary Firms,Corporations, Co-operative.  Agricultural Produce Marketing Committees, Marketing Boards /Committees, Agricultural Industries Corporations. REPAYMENT :  The loan has to be repaid within a maximum period of 9 years inclusive of a grace period of 2 years; instalments are fixed depending on the cash flow.

  32. AB-1: Hypothecation Agreement (Invariably for above Rs.1 lac.) AB-1 (Simplified): Hypothecation Agreement uptoRs.1.0 lac AB-2: Guarantee Deed AB-3: Mortgage Deed AB-4: Revival letter (Borrower) AB-5: Revival letter (guarantor) AB-6: Notice to borrower if loan is not paid on due date. AB-7: Conversion of crop loan into Term loan on account of crop failure. It is obtained as an unstamped document signed by both Borrower and Guarantor 32

  33.  The Income Recognition and Asset Classification (IRAC) norms for Agriculture segment are different from PER ,SME & MISC. segments. In Agriculture segment where the income of the borrower is linked to crop harvesting and the 90 days overdue/out of order concept will not be applicable.  Where as in Agriculture allied activities like Poultry, Dairy and SHG loan accounts the 90 days over due/out of order concept is applicable.  In case of KCC & ATL accounts the NPA norms are linked to crop seasons with repayment due date. For the purpose of IRAC norms in KCC & ATL other than allied activities and SHGs, we have to consider the crop season, crop duration, repayment due date, Mono cropping and Double cropping into consideration. 33

  34. In our country the crop seasons in agriculture are as under:  Kharif (July to December)  Rabi ( October to April)  Summer (March to June)  Each such season has definite duration which takes into account crop period (Sowing & Harvesting) and a reasonable period of marketing generally two months time. Therefore seasons (inclusive of marketing time) are recognized as above. As per the banking finance reference, we classify broadly the seasons into two categories:  1.Kharif( Finance between April to September)  2.Rabi (Finance between October to March) 34

  35.  Short duration crops: The life cycle of the entire crop ( sowing to harvesting) completes maximum Short term crops can be grown either in Kharif or in Rabi season. Eg: Paddy, Groundnut, Cotton etc., within 5 to 6 months period .  Long duration crops: Those crops which are not covered under short duration crops are called long duration crops . Normally the life cycle of the crops extends from 12 months or even more from planting to harvesting period.  Mono cropping: Mono cropping means raising a single crop in a same piece of land during one Agriculture Year (July to June)  Double cropping: Double cropping means raising two crops in a same piece of land during one Agriculture year (July to June). 35

  36. Agri.NPA Based on the revised repayment due dates IRAC classification in KCC accounts will be done as under: 36

  37.  Classification of Re-phased/Rescheduled crop loans: Where natural calamities occurred and KCC accounts re- scheduled, the overdue amount will be classified as current dues and these accounts will not be classified as NPAs . If the installment/interest remains un-paid for the two crop seasons from the due date for short duration crops and one year from the due date for the long duration crops then these accounts will be classified as NPAs.  Agriculture Term Loans : The installments fixation in Agriculture Term loans should be based on the cropping pattern of the individual borrower in all the cases except in allied activities and SHGs. The NPA reckon date should be linked to crop raising pattern of the individual borrowers as mono-crop, double-crop, short duration crop or long duration crop as the case may be. 37

  38.  Demand loans sanctioned against security of Gold/Silver ornaments for agriculture activities will be classified as per norms applicable to Agriculture segment according to the facility sanctioned.  Demand TDRs/NSCs/LIC policies/KVPs/IVPs are outside the purview of IRAC norms as long as the outstanding is covered by the securities. loans/Overdrafts to agriculturists against 38

  39. Thank You 39

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