Small farmers included in subsidised loan scheme

- POST REPORT, Kathmandu
Small farmers included in subsidised loan scheme

Mar 15, 2015-

Nepal Rastra Bank (NRB) on Sunday introduced an amendment to the “Working Procedure on Interest Subsidy for Agriculture Loans to the Youth”, enabling small farmers to get the credit.

Earlier, only youths aged 21-45 years could get the loans at 6 percent interest (the government subsidises 4 percent interest).

The amended working procedure was approved by the Cabinet on January 17. The government made the amendment after lawmakers and farmers’ groups pressured the government to make provisions more flexible enabling farmers, irrespective of their age, to get the cheaper loans.

In the revised working procedure, all types of banks and financial institutions have been allowed to extend the credit. Earlier, only commercial banks were allowed to engage in this business.

The amendment has also opened the door for farmers in sub-metropolitan cities such as Pokhara, Biratngar and Birgunj to get the loans. Earlier, commercial agriculture activities in metropolitan cities and sub-metropolitan cities were kept out of this scheme.

The new provision has paved the way for financial institutions to release up to Rs 30 million for cold storage. Earlier the maximum limit was Rs 10 million, irrespective of the nature of the business. At the recommendation of the coordination and monitoring committee, the loan amount could go up further, the revised working procedure states.

There is a provision of forming such committee under the coordination of the deputy governor.  The revision has also paved the way for forming district-level monitoring and coordination committees.

Bee keeping, barley, buckwheat and silam cultivation has also been brought under the scheme.

Under the scheme, farmers working in various areas including vegetable production, processing and storage; seed production, processing and storage; floriculture; livestock; fruits production, processing and storage; and dairy production, processing and sales can get the subsidised loans.

Fishery, production and sales; mushroom production, processing and storage; animal slaughter house and meat business; herbal production, processing and storage; sugarcane, cardamom and ginger farming, storage and processing; and agriculture business are other areas eligible for the subsidy.

Published: 16-03-2015 09:06

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