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Agri Business Finance

We Represent A Leading Private Bank For Money Required For Agri Businesses.

Firstly It Is Banking Facility Like O.d For Agri-business And Is Not A Farmer Loan.

People In Agri Business Can Get Up In Various Schemes From 25 Lakhs Up To 5 Crores.

However, This Loan Is Against Self Occupied Residential Property As Collateral Security. This Property Has To Be In Urban / Semi Urban Area Equivalent To 200% Of O.d Limit.

I.e For Example . If Property Market Value Is 50 Lakhs, Max. O.d Is 25 Lakhs.

If Some Businessmen Have Godowns / Shops / Commercial Premises, Even They Can Be Considered For Collateral, To Enhance O.d.limits.

Interest Rates For O.d Is 11.75 - 12%
But Interest Is Charged Only On The Portion And Period Of O.d. Facility Availed.

There Is Also Scheme For Regd. Agro Based Small Scale Industries Can Avail Facilities From 5 - 25 Lakhs Without Any Security / Collaterals.
This Scheme Is Also For New S.s.i's.
But Before Application For Loan, S.s.i Regn Is Must.

There Are Special Schemes For Farmers Of Sugarcane, Dairy, Poultry, Plantation Crops Etc But In Each Of These Case The Collateral Is Given By The Industry To Whom They've Already Large Limits Sanctioned.

Also There Is Scheme For Commodity Traders Against Warehouse Receipt Scheme. But Here Minimum Value Of Goods Should Be Over 3 Crores Stocked In One Cluster Area.

I Do Agree With Members Using This Forum That Banks Are Not At All Comfortable With Direct Farmer Financing.

However, One Must Try & Understand Banker's Point Of View.

In Name Of Priority Sector / Agri Finance, Threre Have Been Lot Of Frauds By Certain Co-op / Scheduled Banks Have Led Rbi To Pass Strictures.

On Other Side, Poor Farmers Have Been Running To Private Lenders.private Lenders Have Been Charging Exhorbitant Interests For Unsecured Loans Taking Advantage Of Situation.

Instead Of Looking For Agri Funds Less Than 7-8 % Interest, Farmers Must Understand And Look For Schemes Higher Inerest Rates.

In Conclusion

Two Important Things To Note

Public Sector / Nationalised Banks Have Schemes Of Direct Farmer Financing. However, It Has A Procedural Norm Which Every Body Is Aware Of.
Public Sector Banks Give Funds Based On Case To Case Based Merits Depending On Comfort Level At Branch Levels.


Private Banks Have More Agressive Marketing.
However, Their Approach Is They're Comfortable Only When Industry In Involved In Chain And Or Readily Liquidable Properties Are Available As Collateral.

Private Sector Banks Give Funds Based On On Comfort Level In The Particular Sector Performance.


At End Of The Day
Banks Funds Are Better Any Day Than Private Money Lenders.[/quote]