This Reserve Bank of India (RBI) circular, reference number FIDD.CO.FSD.BC.No.1005/05.01.020/2024-25, dated December 6, 2024, addresses all Scheduled Commercial Banks (including Regional Rural Banks and Small Finance Banks), State Cooperative Banks, and District Central Cooperative Banks regarding credit flow to agriculture. The circular revises the limit for collateral-free agricultural loans, including loans for allied activities, from ₹1.6 lakh to ₹2 lakh per borrower. This decision was made considering overall inflation and the rise in agricultural input costs. The RBI advises banks to waive collateral security and margin requirements for agricultural loans up to ₹2 lakh per borrower. Banks are instructed to implement these revised instructions no later than January 1, 2025, and to publicize the changes adequately. For further information, contact R. Giridharan, Chief General Manager, Financial Inclusion Development Department, Central Office, 10th Floor, C.O. Building, Mumbai – 400001. Phone: 91-22-22661000. Fax: 91-22-22621011/22610948/22610943. Email: cgmincfidd@rbi.org.in. The circular references earlier guidance provided in circular FIDD.CO.FSD.BC.No.1305/05.01.020/2018-19 dated February 7, 2019.
Key Entities Referenced
Reserve Bank of India: The central bank of India, responsible for regulating the country's banking system.
Scheduled Commercial Banks: A category of banks in India that are listed in the Second Schedule to the Reserve Bank of India Act, 1934.
Regional Rural Banks: Regional Rural Banks (RRBs) are financial institutions in India that operate at the regional level to provide credit and other banking services to the rural population, particularly small and marginal farmers, agricultural laborers, and artisans.
Small Finance Banks: Small Finance Banks (SFBs) are a type of bank in India licensed by the Reserve Bank of India (RBI) to further financial inclusion by primarily undertaking basic banking activities such as accepting deposits and lending to unserved and underserved sections including small business units, small and marginal farmers, micro and small industries and unorganised sector entities.
State Cooperative Banks: State Cooperative Banks are apex cooperative banks in a state of India.
District Central Cooperative Banks: District Central Cooperative Banks (DCCBs) operate at the district level in India and are part of the cooperative credit structure. They primarily serve the financial needs of agricultural and rural sectors within their respective districts.
Financial Inclusion Development Department: A department within the Reserve Bank of India responsible for policies related to financial inclusion.
Mumbai, Maharashtra: City in India where Central Office of RBI is located.
भारतीय �रज़वर् बैंक
______________________ RESERVE BANK OF INDIA________________________
www.rbi.org.in
RBI/2024-2025/96
FIDD.CO.FSD.BC.No.10/05.05.010/2024-25 December 6, 2024
The Chairman / Managing Director / Chief Executive Officer
All Scheduled Commercial Banks (including Regional Rural Banks and Small Finance
Banks)
All State Co-operative Banks and District Central Co-operative Banks
Madam/Sir,
Credit Flow to Agriculture – Collateral free agricultural loans
Please refer to our circular FIDD.CO.FSD.BC.No.13/05.05.010/2018-19 dated February
7, 2019 on the above subject.
2. Keeping in view the overall inflation and rise in agriculture input cost over the years, it
has been decided to raise the limit for collateral free agricultural loans including loans for
allied activities from the existing level of ₹1.6 lakh to ₹2 lakh per borrower. Accordingly,
banks are advised to waive collateral security and margin requirements for agricultural
loans including loans for allied activities upto ₹2 lakh per borrower.
3. The banks are advised to give effect to the revised instructions expeditiously and in
any case not later than January 1, 2025. The banks are also advised to give adequate
publicity to the above changes.
(R. Giridharan)
Chief General Manager
�वत् तीय समावेशन और �वकास �वभाग, केंद्र�य कायालर् य, 10वीमंिजल, केंद्र�य कायार्लय भवन, मुंबई 400001
टेल�फोन /Tel.No: 91-22-22661000 फैक्स/FaxNo: 91-22-22621011/22610948/22610943
ई-मेल/ Email ID: cgmincfidd@rbi.org.in
Financial Inclusion & Development Department, Central Office, 10th Floor, C.O. Building, Mumbai 400001
�हदं� आसान है, इसका प्रयोग बढ़ाइये
“चेतावनी: �रजव र्बकैं द्वारा मेल एसएमएस या फोन कॉल के ज�रए �कसी क� भी वय्िक्तगत जानकार� जैसे बकैं के खाते का बय्ौरा, पासवड र्
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