NABARD launches ₹5000 crore refinancing facility

Updated: Jul 15, 2020

The National Bank for Agriculture and Rural Development (Nabard) has announced a Rs 5,000 crore grant-based scheme for computerisation of 35,000 Primary Agricultural Credit Societies (PACS).Under the scheme, assistance will be released to state governments which will also have to contribute a matching grant for disbursement to the PACS.

As many as 40% of 12.5 crore small and marginal farmers depend on PACS to get short-term loans. Not only computerisation, the scheme also will ensure integration of these PACS with the Core Banking System (CBS) of District Central Co-operative Banks (DCCBs) to ensure seamless flow of credit.

As many as 5,000 PACS will be upgraded this year while 15,000 PACS each during next two fiscal, Nabard said in a statement. As PACS also act as a one-stop solution for supplying key agricultural inputs — fertilizers and seeds — to farmers as well as undertake procurement of paddy and wheat from farmers under MSP operation of the Food Corporation of India (FCI), the grant will help turn these societies into multi service centres.

Nabard also said concessional bank refinance of Rs 5,000 crore will be made available to banks and financial institutions for lending to beneficiaries in 2,150 watershed development projects to help boost offtake of economic activities in areas grappling with reverse migration. These projects cover 23.04 lakh hectare of rainfed, watershed and tribal development project areas. The concessional line of assistance will be available for three years until 2022-23.

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