Agricultural Gold Loan Benefits, Eligibility and Interest Rate

Agricultural Gold Loan Benefits, Eligibility and Interest Rate
Agricultural Gold Loan Benefits, Eligibility and Interest Rate

An agriculture gold loan is a gold loan that farmers can avail against the mortgage of the gold ornaments to fund their farming and allied activities. These include purchasing raw materials, buying a new plot of land, making investments in irrigational purposes, maintaining inventory and looking after crop cultivation. Generally, an Agri Gold Loan amount starts from Rs.25,000/- and ranges up to Rs. 25,00,000/-. Farmers are offered real-time access to the authorised sum and are entitled to pay interest on the used amount only. Also, backed by a quick approval process and overdraft facility, agriculture gold loans are easy to manage. This particular write-up will serve as an appropriate destination to know about what is agriculture gold loan overdraft, related schemes and eligibility criteria.

Agriculture Gold Loan – Features and Benefits

  • An agriculture gold loan interest rate starts from 7.00% per annum and ranges up to 13.00% per annum.
  • The gold deposited is kept safe within the vault of the chosen bank and is returned upon repayment of the lent amount.
  • The loan amount is made available across all rural and semi-urban bank branches.
  • Unlike other loans, an agriculture gold loan gets disbursed on the same day, helping borrowers with quick funds.
  • Gold Loan disbursement is also made available via NEFT, account transfers, DD and RTGS.
  • An agriculture gold loan holder can repay the borrowed amount in EMIs or a lump sum, as per convenience.
  • Also, there are banks providing loan renewal facilities to customers with quality repayment history.

Agriculture Gold Loan Schemes

Here is a list of various agriculture loan Schemes made available in the market.

Cent Agri Gold Loan Scheme – Central Bank of India

Farmers or borrowers engaged with any agricultural activity can avail of this loan.

Processing Charges: NIL

Eligible Gold: 22 carat minimum

Repayment Period:

  • The lent amount is made valid for 5 years (overdraft/cash credit)
  • Within 18 months (demand loan)
  • Within 5 years (term loan)

Multipurpose Gold Loan – State Bank of India

Farmers who cultivate their own land or engage with allied activities like poultry, dairy, sheep and piggery can avail of this particular loan scheme.

Processing Charges: NIL

Eligible Gold: Regular gold ornaments (18/20/22/24-carats) gold bars are not allowed

Repayment Period: 12 months from the date of loan disbursal

Farmers Gold Loan – Axis Bank

Axis Bank offers gold loans with quick approvals and adequate overdraft facilities against gold ornaments, enabling access to real-time funds when in need.

Processing Charges:

  • 0.50%(agri)
  • 0.50%(non-agri)
  • NIL(SO_LNAPG)
  • 0.50%(Overdraft Agri PGLOD)

Eligible Gold: Negotiable

Repayment Period: 12 months

Agricultural Gold Loan – South Indian Bank

Farmers related to agricultural crop production and allied activities can proceed with this particular scheme.

Processing Charges: 0.25%

Eligible Gold: 22-carat gold jewellery

Repayment Period: 6 months to 12 months

Agricultural Gold Loan Eligibility and Documents Required

Eligibility

    • The applicant must be above 18 years and below 75 years of age.
    • The farmer must provide proof of their agricultural land along with recent documents validating crop production and related activities.
    • Gold ornaments, fulfilling the eligibility criteria of gold loan made mandatory by individual banks.

Documents Required

      • 2 photographs (passport size)
      • KYC Documents (voters ID card, driving license, utility bill, passport)
      • Application form
      • Age Proof
      • Pan Card or Form 60
      • Certificate of business incorporation

Agriculture Gold Loan – EMI Calculator

You can use Online EMI calculators on an online marketplace like MyLoanCare to calculate EMI on your loan using the steps mentioned below:

        • Step 1: Visit one of those Gold Loan EMI Calculator pages.
        • Step 2: Update the preferred loan amount, tenure and interest rate charged.

Once completed with the entry part, they will be provided access to an adequate EMI amount which is absolutely negotiable.

Agricultural Gold Loan – Process

The agriculture gold loan application process is made seamless by offering adequate customer support across the different offline branches of individual banks. Also, those opting for a loan overdraft facility are provided access to 75% of the approved amount. The farmers can use this amount as per their requirement and repay the interest of the used amount only. Unlike regular gold loans where the borrower is entitled to a fixed rate of interest, prescheduled loan tenure and a dedicated loan amount, the interest rate for an agricultural gold loan is calculated based on the usage level if availed with an overdraft facility and on a simple interest basis for regular schemes.

            • A cheque book and ATM card are issued against a loan overdraft account backed by a net banking facility.
            • Banks do provide timely reminders and SMS based notifications related to due payments and other processing charges. However, if a borrower still misses out on their due date, late payment charges are made applicable as per the prescheduled agreement.

An agriculture gold loan provides access to quick funds within no time and is unique in its way. Indian farmers have long enjoyed the benefits of this system due to its immense popularity among rural cultures.

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