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Collateral-Free Farm Loan Limit
February 16 , 2019
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- Reserve Bank of India (RBI) raised the limit of collateral-free agricultural loans to Rs. 1.6 lakh from the current Rs. 1 lakh with a view to help small and marginal farmers.
- The central bank also decided to set up an internal working group (IWG) to review agricultural credit and arrive at a workable policy solution.
- The one lakh limit was fixed in the year 2010.
- Keeping in view the overall inflation and rise in agriculture input costs since then, it has been decided to raise the limit for collateral-free agriculture loans.
- This will enhance coverage of small and marginal farmers in the formal credit system.
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