Many farmers in the country need money for their farming. In this situation, a lot of farmers borrow money from people in their villages or towns.
However, this borrowed money is quite expensive, and the farmers have to promise something valuable to the lender.
The interest rates on these loans are very high, making it hard for farmers to pay back the money. Even if farmers borrow from a bank, the interest rates are still high.
To help farmers with their loans, the central and state governments have created many plans. One popular plan is the Kisan Credit Card (KCC).
Today, we will talk about a special scheme from the government of Rajasthan that helps farmers with their loans.
The government offers loans to farmers at lower interest rates through cooperative societies.
Some farmers manage to pay back their loans on time, while others may struggle. For those farmers in Rajasthan who repay their loans on time, the government has introduced an interest subsidy scheme.
This means that the state government is giving a 5 percent discount on the interest paid by farmers on their loans. This benefit is only available for long-term loans.
The Cooperative Minister of Rajasthan, Udaylal Anjana, explained that the government has been providing this subsidy since the financial year 2014-15.
It applies to various loans, including those for buying better-quality animals like dairy animals, sheep, and goats.
The government is also offering a 5 percent interest subsidy on these loans. Farmers who repay their long-term agricultural loan installments on time receive this 5 percent subsidy on the interest rate.
There are two types of loans that farmers can take. The first is a short-term crop loan, which is for a period of 6 to 15 months and is usually paid after the harvest.
The second is a long-term agricultural loan, which is for more than 5 years. Short-term crop loans are taken for things like fertilizers and seeds, while long-term loans are for resources like tube wells, dairy, land reclamation, tractors, and irrigation equipment.
