In agricultural finance the credit of a farmer are met through broad categories of advance. Based on the period of credit short term loans, and medium term loans or long term loans are classified as direct finance.
SHORT TERM LOANS
Loans repayable up to 18 months are termed as short term loans. This includes crop the limits sanction through a kisan credit cards scheme for raising crops, loans against gold ornaments for agriculture purpose.
MEDIUM OR LONG TERM LOAN
More than 36 months is the period of credit under this category . This includes loan for the purpose of minor irrigation, farm or land development, plantation and horticulture, allied activities such as dairy farming, sheep or goat rearing, poultry farming, fisheries, mushroom cultivation, biogas plant.
In indirect finance includes credits for financing distribution of fertilizers, pesticides, loan granted to electricity broads for energising pumps set under Rural Electrification Corporation(REC) scheme, finance for constructions and running storage facilities in the producing areas,loans to individuals institutions for organisation, advance to state Corporation for onward lending to weaker section.
FEATURES OF AGRICULTURAL LOAN
The purpose of the crop loan is facilitate the agriculturists yaariyan seasonal operations to meet the expenses for raising of seasonal crops including the cost of seeds, fertilizers and pesticides, irrigation charges, labour charges etc., Agriculturists, tenant farmers and sharecroppers who actually cultivate the lands are eligible for this loan. All categories of farmers like small or marginal farmers and others are included. Loans amounts are worked out based on the cost of cultivation, for each crop per acre of the crop cultivated.
KISAN CREDIT CARD
All farmers who require loan for their cultivation expenses are eligible to get loan under the kisan credit card scheme.
In Kisan credit card farmers can to meet their cultivation needs and non-farm requirements, which includes the purchase of inputs and other short term requirement with working capital cost effective manner and flexible in a requirement are allied activities. Apart from a loan for cultivation purposes, a consumption loan for a certain percentage of limit is also give for other household expenses.
Loans to small and marginal farmers and landless labourers for purchases of agricultural land. Eligibility small and marginal farmers, tenants, sharecroppers subject to a land holding criteria.
AGRICULTURAL TERM LOAN
Agricultural term loans are provided for the purchase of assets farm machinery, bullocks, sheep, etc., creation of assets orchard development, poultry, dairy developing, etc., connected with rural activities under agriculture, horticulture, plantation, animal husbandry, fisheries. Where the loan amount is repayable over a period of time exceeding three years .
Credit for land development projects, in the form of direct finance to cultivators, for better productivity. loans under this covers various activities like land clearance, land leveling, bench terracing for hilly areas, disposal drains, reclamation of saline soils and fencing etc.,
Credit of farm equipment and machinery is for the purpose ofa agriculture operation. The scheme covers activity ranging for purchase of tractors and accessories, power tillers, combine harvesters, power sprayers, dusters, threshers etc.
Credit for the creation of irrigation facilities from underground surface water source. All structures and equipment connected with the proposed facility are financed. Various activities like opening of borewells, deepening of existing wells, laying of pipelines, installing drip, oil engine,sprinkler irrigation system and lift irrigation system.
FINANCE TO HORTICULTURE
Credit for finance to horticulture developing loans for fruit orchards I like mangoes, guava, grapes, pomegranates, apples, lechee, etc.as well as short term fruit crops of banana, pineapple etc., and loans for the flowers of roses Jasmine, chrysanthemums. And vegetables crops of potatoes, brinjal, ground, peas, etc.are finance.