Jammu And Kashmir Grameen Bank Farm Mechanization Scheme

A. Purpose:

i) Purchase of new tractors and matching implements/ equipments such as cultivators, harrows, disc ploughs, trolleys etc.;
ii) Purchase of new power tillers;
iii) Purchase of tractors/ power tillers for the second time with matching implements;
iv) Purchase of agricultural machinery such as threshers, harvesters, seed drills, seed cum fertilizer drills, harrows, hoes, sprayers, plant protection equipment etc. Agricultural machinery may be power/manual/tractor driven.
v) Purchase of second hand tractors with matching implements.

B. Eligibility:

a) Farmer having minimum 8 Kanals of irrigated land or 16 Kanals of un-irrigated land singly or jointly. Joint land holder will stand as a guarantor.
b) Minimum land holding criteria may be waived in cases where financing of tractor is secured up to 100% of loan by liquid security like FDR,NSC, Assignment of Insurance Policy etc. However, the applicant should be a farmer.
c) Financing shall be done after ensuring economic viability of the loan proposal. Economic viability of financing second hand tractor in each case shall be worked out by taking income derived by use of tractor in farm as well as non-farm use.
d) The maximum age of applicant at loan maturity should not be more than 70 years. In case, the age of applicant is above 70 years but less than or equal to 75 Years (at loan maturity), then at least one of the legal heirs having age less than 60 years is taken as a co-borrower .

C. Quantum of Loan:

For purchase of Tractor, Power Tiller/ farm machinery/ equipment:
Need based loan net of margin shall be provided.
For purchase of Second Hand Tractor:
Maximum amount of loan will be 75% of depreciated value of tractor by approved valuer or 75% of sale value of Vehicle (as per agreement to sell) or 75% of IDV in Insurance Policy, whichever is lower. Maximum quantum of loan for second hand tractor and three implements including a trailer shall be restricted to Rs 3.00 Lakh (Three Lakh only).

D. Margin:

For purchase of New Tractor,Power Tiller, farm machinery/ equipment:

(Margin will be calculated on the unit cost plus One time Registration Charges (*wherever applicable) excluding insurance & tax. The borrower will be required to deposit the entire margin upfront with the Bank, which shall be released subsequently along with the loan component directly in favor of the supplier to ensure proper end use of funds). For purchase of Second Hand Tractor: 25% of depreciated value of tractor/IDV/sale value of tractor to be financed is to be met by borrower from his own sources.

E. Repayment Period:

For purchase of New Tractor, farm machinery/ equipment: The loan will be repayable within a maximum period of 9 years in 18 half-yearly installments. The first installment will start at the first harvest after disbursement of loan.
For purchase of Power tillers: The loan will be repaid in 5 years to 9 years in 10 to 18 half yearly installments depending upon the economic viability of the unit.
For purchase of Second Hand Tractor:
• Maximum repayment period of 5 years for tractors having age less than 3 years.
• Maximum repayment period of 4 years for tractors having age equal to or more than 3 years & upto 5 years.

F. Security:

Primary:

Hypothecation of machinery/ equipment/ implement & other assets created out of Bank finance.

Collateral:

No collateral for loans up to ₹2.00 lakh is required under Agricultural Sector, as per RBI guidelines.

Processing Charges:

0.50% of the loan amount.

* Conditions Apply