Agriculture financing is of two types:-
(i) Direct finance to farmer for agriculture.
(ii) Indirect finance to agriculture.
Short- term loans for raising crops.
In addition, advances up to Rs5 lakh to
farmers against agricultural produce for a
period not exceeding 12 months, where the
farmers were given crop loans for raising the
produce, provided the borrowers draw credit
from one bank.
Medium and long-term loans are also provided
directly to farmers for financing production
and development needs.
(a) Purchase of agricultural implements and
(b) Development of irrigation potential through
construction tube wells, boring wells,
construction of lift irrigation project etc.
(c) Construction of farm buildings and
structures like bullock sheds, tractor sheds
(d) Construction and running of storage
(e) Payments of irrigation charges.
(f) Development of dairying and animal
(g) Financing to small and marginal farmers for
purchase of land for agricultural purposes.
(a) Loans to farmers for purchase of shares in
co-operative sugar mills and other agro
based processing unit.
(b) Loans to farmers through PACS, FSS and
(c) Credit for financing the distribution of
fertilizers, pesticides, seeds etc.
(d) Finance for hire-purchase schemes for
distribution of agricultural machinery and
(e) Subscriptions to bonds issued by NABARD
with objectives of financing exclusively for
(f) Loans to individuals, institutions or
organizations who under take spraying
(g) Lending to Non Banking Financial
Companies(NBFCs) for lending to agriculture.