Priority Sector

Objective
 

To provide uninterrupted, quick and hassle free credit with a view to appreciate and encourage good borrowers /depositors for different productive activities.

Area of operation
 

All rural and semi urban branches.

Purpose
 

For all kinds of agricultural, allied and other productive activities with emphasis on minor irrigation, farm mechanization, horticulture and plantation, dairy, poultry, fishery, sericulture, bio-gas, high-tech agriculture, setting up of agri-business/agri-clinic, purchase of land for agricultural purposes.

Eligibility
 

i.

Existing medium term farm borrowers with good track record for the last 3 years, woman family members of such borrowers

ii.

Existing depositors maintaining an average balance of Rs.25,000/- or above for the last 3 years can apply himself (herself) / recommend the loan proposals under this Scheme as guarantor.

Quantum of loan
 

i.

Maximum upto the amount of the original loan repaid by the existing borrower without further security.

ii.

Maximum of Rs.50,000/- in case of woman family member.

iii.

Need based finance depending upon the scheme applied / recommended / guaranteed by the existing depositors with the following margin :

Margin
 

Women family members

...

Nil

Loan upto Rs.50,000/-

...

Nil

Rs.50,001/- to Rs.2.00 lac

...

10%

Above Rs.2.00 lac

...

20%

Rate of interest
 

As per RBI / H.O. guidelines issued time to time and as applicable to priority sector advances. However, concession in the rate of interest is to be allowed as under :-

a)

0.50% in case of women family members

b)

0.50% in case Depositor is the borrower

c)

0.25% in case Depositor is the proposed guarantor

Security
 

Primary

Hypo. of assets created out of the loan.

Additional

I. For loans to MTFL account holders :

a)

Loan limit up to Rs.50,000/- (inclusive of existing limit) – No additional security other than hypothecation.

b)

For loan limit above Rs.50,000/- mortgage / charge on land or third party guarantee acceptable to the bank or extension of existing mortgage/charge/guarantee.

II. For loans availed/guaranteed by depositors :

a)

Loan limit up to Rs.50,000/ - Nil

b)

Mortgage/charge on land or personal guarantee from persons acceptable to the bank as per norms for loan limit above Rs.50,000/-.

III. For loans granted to women family members :

a)

Personal guarantee of depositor / principal borrower only.

Repayment
 

i.

Repayment period of loans under agriculture and allied activities will be guided by NABARD's repayment schedule for farm loan as circulated in "Guidelines on Farm Finance" (4th edition, Annexure-xi) (5-15 years)

ii.

Instalments should be fixed either monthly, quarterly or half-yearly basis commensurating with the income generation from the activity for which the loan is granted.

Insurance
 

The assets created out of loan are to be insured for fire and other risks with bank clause and to be renewed every year. However, in case of loan limit up to Rs.10,000/- for equipments and current assets insurance may be waived at the request of the borrower or at the discretion of the bank.