RBI Raises Collateral-Free Agricultural Loan Limit to ₹2 Lakh
| Key Points | Details |
|---|---|
| Why in News | RBI increased the collateral-free loan limit for farmers from ₹1.6 lakh to ₹2 lakh, effective January 1, 2025. |
| Revised Loan Limit | ₹2 lakh for agricultural and allied activities per borrower. |
| Previous Loan Limit | ₹1.6 lakh |
| Effective Date | January 1, 2025 |
| Target Beneficiaries | Small and marginal farmers (over 86% of farmers). |
| Purpose | To address rising input costs and improve credit access. |
| Key Scheme Mentioned | Kisan Credit Card (KCC) Scheme |
| Interest Subvention Scheme | Modified Interest Subvention Scheme offers loans up to ₹3 lakh at 4% effective interest rate. |
| Bank Directive | Waive collateral and margin requirements for loans up to ₹2 lakh. |
| Associated Institution | Reserve Bank of India (RBI) |
| Additional Initiative | Promotion of Primary Agricultural Credit Societies (PACS). |
| Static Points - RBI | Governor: Sanjay Malhotra |
| Headquarters: Mumbai |