In an attempt to boost capital infusion in agricultural sector the National Bank for Agriculture and Rural Development (NABARD) has decided to provide refinance facility with a repayment period of five years at an interest rate of only 7.85 percent to cooperative bans and Regional Rural Banks (RRB).
Informing newsmen here on Monday about the decision the Chief General Manager (CGM) Uttarakhand region CM Mohan said that substantial reduction in interest rate for refinance would help in building capital formation in the agricultural sector.
He said that the bank is planning to disburse 150 crore to cooperative banks and RRBs in Uttarakhand this year. Mohan said that the bank has decided to reduce interest from existing 9.3 per cent to 7.85 per cent in the refinance facility. The capital infusion would help the poultry, dairy, farm mechanisation and horticulture activities in the state. He said that RRBs and the Cooperative banks provide long term loan facility to small and marginal farmers and have a better outreach in the rural areas.
The CGM of NABARD said that the bank would provide a loan of `550-600 crore to the Government of Uttarakhand under Rural Infrastructure Development Fund this year. He informed that the bank has sanctioned `3,200 crores to the state since its creation to build infrastructure in the rural areas. Mohan said the bank is planning to venture in new sectors to develop the rural areas, he cited the infrastructural gaps in the existing projects as one such area. Giving example of infrastructure gap he said that in rural road projects the rural population can be benefited more by building small bridges.
To provide refinance facility to the RRBs and Cooperative banks the NABARD launched the long Term Rural Fund on Monday. Announcing the launch of fund at Mumbai the Chairman of NABARD Dr H K Bhanwala said that Cooperative banks and RRBs would be motivated to extend term loans/ investment credits to their clients at concessional rates.