Purpose

• The scheme aims at providing term loan to small/marginal farmers including share croppers /tenant cultivators to purchase agricultural land as well as fallow and waste land production /to develop and cultivate .

Eligibility

• Small & Marginal Farmers who own a maximum of 5 acres of non-irrigated land or 2.50 acres of irrigated land including the land proposed to be purchased.
• Share croppers/tenant Farmers cultivating up to 2.50 acres of irrigated land or 5 acres of un-irrigated land including the land proposed to be purchased.
• Agri. Entrepreneurs who does not own agricultural land but have agricultural background are also eligible to avail loan for purchase of agricultural land, provided the respective state laws permit, non-agriculturist to purchase agricultural land.
• Farmers should remain under the category of small farmer (5 acres of non-irrigated land or 2.50 acres of irrigated land) even after purchasing the proposed land.

Quantum of Loan

• The quantum of loan will depend upon
  • valuation as assessed by the Branch / valuer
  • guidance value / Circle rate fixed by the State or
  • the registration value
    whichever is lower plus value of stamp duty, registration charges for sale/ mortgage deed.

• Maximum amount Rs 10.00 lacs.        

Margin

The margin shall be minimum of 20%.

Security

• As land being financed by the bank is a primary security, mortgage of land proposed to be purchased has to be done irrespective of quantum of loan.
• Also Mortgage of land presently owned, if any, as collateral security.
• The loan amount should not exceed the value of present land + value of the proposed land to be purchased.
• Hypothecation of crops grown from time to time on the land.

Repayment Period

The loan is to be repaid in maximum 10 years in half yearly / yearly installments including a maximum moratorium period of 24 months.

Forms & Documents

Appropriate DPN note, Deed of Guarantee, Letter of continuity, , Hypothecation agreement, Declaration/undertaking for Agriculture advance, Mortgage deed ,Letter of general lien and setoff, Undertaking from borrower/Guarantor for disclosure to CIBIL, and any other document stipulated in sanction