Last Updated on: 28/01/2025
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FARM MECHANIZATION– (For Farm Automation)
Objective
Financing for Farm Mechanization-Agri. Machinery, Accessories, Tools & Equipment's
Nature and Purpose of Advance
Financing for Purchase of Farm machinery like, Tractors/ Power Tillers/ Combined Harvesters /Mini Tractors etc.
Farm implements/equipment's/tools either Tractor drawn, Power tiller drawn or independently operated for various farm operations etc.
Loan for renovation and repairs of Tractors
Quantum of Loan
Minimum - No Minimum
Maximum - No Minimum
Eligibility
For Tractors: 35 HP & Less - At least 4 acres of land having perennial irrigation facilities
Above 35 HP - At least 6 acres of land having perennial irrigation facilities
For Power Tillers (10-15 HP): Minimum acreage is 6 acres land with perennial irrigation source
Combine Harvesters Following custom service per combine harvester Should be available & minimum cropped area of 500 Ha (1250 acres) of Wheat & 300 Ha (750 acres) of Paddy in Wheat/Paddy rotation Region or Minimum cropped area of 300 Ha (750 acres) of Paddy per harvesting season in Paddy-Paddy crop rotation Region.
Security
Up to Rs. 2.00 Lakhs: Hypothecation of assets created out of loan. Nil Collateral
Above Rs 2.00 Lakhs: Loan should be adequately secured by way of immovable property whose value is not less than/ equal to the loan amount.
Margin
Up to Rs. 2.00 Lakhs: Nil
Above Rs 2.00 Lakhs: 15% to 25%
Minimum 25% Margin for Combine Harvester
Repayment
For Tractors, the loan should be repaid within a period of 9 years.
For Power Tiller, the loan should be repaid within a period of 7 years.
For other machinery/ equipment's, the repayment period may be fixed between 3 to 7 years.
For Combine Harvester, the loan amount should be repaid within a maximum period of 7 years in half yearly instalments coinciding with the seasons of harvest.
For Renovation/Repairs of Tractors, repayment period should not exceed five years and the repayment schedule should be fixed depending on the nature of repairs, life of machine, repayment capacity etc.
Rate of Interest
Up to Rs. 5 Lakhs - 1 Year MCLR (9.10% at present) + 1.40% (spread) = 10.50% at present.
Above Rs. 5 Lakhs up to Rs. 25 Lakhs - 1 Year MCLR (9.10% at present) + 2.25% (spread) = 11.35% at present.
Above Rs. 25 Lakhs up to Rs. 1.00 Crs - 1 Year MCLR (9.10% at present) + 2.75% (spread) = 11.85% at present.
Above Rs. 1.00 Crs - 1 Year MCLR (9.10% at present) + 3.25% (spread) = 12.35% at present.
*1 Year MCLR - 9.10% at present.
Processing Charges
Up to Rs. 25000/- - Nil
Above Rs. 25000/- up to Rs. 3 Lakhs - 0.30% of the loan amount
Above Rs. 3 Lakhs - 0.71% of the loan amount.