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Continuation of the Modified Interest Subvention Scheme
Context:
The Reserve Bank of India (RBI) has announced the continuation of the Modified Interest Subvention Scheme (MISS) for short-term loans availed through the Kisan Credit Card (KCC) for agriculture and allied activities during the financial year 2024-25.
About the extended Modified Interest Subvention Scheme (MISS) for 2024-25:
- Loan Limits: Up to ₹3 lakh per annum, with a ₹2 lakh sub-limit for allied activities. Crop loans will be prioritised.
- Additionally, small and marginal farmers can benefit from interest subvention on Kisan Credit Cards for up to six months post-harvest to discourage distress sales and encourage produce storage.
- Warehouse Storage: Small and marginal farmers can avail interest subvention for up to six months post-harvest if storing produce in accredited warehouses.
- Natural Calamities: Subvention applies for up to three years for severe calamities, with a maximum period of five years and a 3% prompt repayment incentive.
- Aadhaar Linkage: Mandatory for availing the scheme’s benefits.
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Modified Interest Subvention Scheme (MISS) The Modified Interest Subvention Scheme (MISS) is a government initiative in India aimed at providing short-term credit to farmers at subsidised interest rates.The Key Features are :
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Schemes by the Indian Government to facilitate agricultural loans :
Kisan Credit Card (KCC) Scheme
- Objective: Provide timely credit for agricultural needs.
- Features: Loans up to ₹3 lakh without collateral; lower interest rates; flexible repayment options.
Agriculture Infrastructure Fund (AIF)
- Objective: Address infrastructure gaps and boost investment in agriculture infrastructure.
- Funding: ₹1 lakh crore has been allocated from FY 2020-21 to FY 2025-26; support extends until FY 2032-33.
- Features:
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- Loans: Provided by banks with 3% annual interest subvention.
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- Credit Guarantee: Coverage under CGTMSE for loans up to ₹2 crore.
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- Project Limit: Each entity can benefit from up to 25 projects in different LGD codes.
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- Eligibility: Farmers, agri-entrepreneurs, start-ups, PACS, cooperative societies, FPOs, SHGs,APMCs, and cooperatives.
PM Fasal Bima Yojana:
- The Pradhan PMFBY is the largest crop insurance scheme in the world in terms of farmer enrolment and is the third largest scheme in terms of insurance premiums.
- The scheme provides a simple and affordable crop insurance product to ensure comprehensive risk cover for crops to farmers against all non-preventable natural risks from pre-sowing to post-harvest.
Key Highlights from the Economic Survey 2023-24 for PMFBY
- Increased Enrollment:Enrollment under PMFBY has increased by 27% in the financial year 2023-24, with nearly 57 crore farmer applications enrolled since its inception.
- Technological Initiatives:The government has introduced various technological measures to enhance the efficiency of the scheme, including the YES-Tech Manual, WINDS portal, and the AIDE/Sahayak enrollment app for better crop damage assessment.
National Agricultural Development Programme (NADP)
- Objective: Promotes holistic agricultural development.
- Features: Focuses on productivity and sustainability.
- Rural Infrastructure Development Fund (RIDF)
- Objective: Loans to state governments for rural infrastructure, including irrigation and storage.
- Benefits: Enhances agricultural productivity and market access.
State-Specific Schemes
- Examples: Bihar Rajya Fasal Sahayata Yojana offers financial aid for crop losses due to natural calamities.
