Who can apply for an Animal Husbandry loan?
In recent years, there has been a increase in the number of individuals taking up farming and its allied activities as their primary occupation. This is due to the various schemes and aids rolled out by the Government of India and banking institutions supporting these occupations. Animal husbandry has seen the same fervour amongst today’s youth.
Animal husbandry loan can be applied by:-
- Farmers and individual entrepreneurs
- NGOs
- Companies and Co-operatives
- Self-Help Groups and Joint Liability Groups
What can avail this loan?
Animal Husbandry loan is primarily offered for purchase of livestock and assets. It can also be used for development of infrastructure required for breeding, management and caring of farm animals. Some of their applications are:-
- Purchase of quality animals, feeds, equipment and machinery
- Construction of cattle shed, poultry shed, piggery, calf rearing units etc.,
- Construction of milk processing units, egg storage facility, hatchery units, pig breeder and fattener units
- Purchase of chicks, feeds etc.
- Purchase of fish food, fishing nets for inland and deep-sea fishing.
Salient Features of Animal Husbandry Loan:-
This loan type is primarily designed to help the farming sector. Following are the features and benefits of the loan
- Higher loan amount of up to 100%, compared to other farm sector loans
- Benefits to the borrower in the form of longer repayment tenures
- Minimal documentation requirements
- Basic security/collateral in the form of hypothecation of the acquired asset
- Low-interest rates to encourage development of animal husbandry.
Who should you approach for Animal Husbandry loan?
Animal Husbandry loan can be availed from
- Commercial banks
- Rural regional banks
- State Co-operative banks
- State Co-operative Agriculture and Rural Development Banks
- Any public or private sector bank
What are the schemes available under Animal Husbandry loan?
There are various schemes and subsidies available for the development of animal husbandry.
NABARD acts as the chief subsidy channelizing agency under Entrepreneurship Development & Employment Generation (EDEG) component of National Livestock Mission. This includes:
- Poultry Venture Capital Fund (PVCF)
- Integrated Development of Small Ruminants and Rabbit (IDSRR)
- Pig Development (PD)
- Salvaging and Rearing of Male Buffalo Calves (SRMBC)
These schemes are available in various agricultural and rural development banks and institutions eligible for subsidy assistance from NABARD.
Department of Animal Husbandry, Dairying and Fisheries
The Department of Animal Husbandry Dairying and Fisheries, under the Ministry of Agriculture, has been working hard since 1991 towards the development of livestock production & preservation and protection from disease. They assist with improvement of stocks and dairy development. They are also the designated agency for the Delhi Milk Scheme and the National Dairy Development Board. They also look after all matters pertaining to fishing, inland and marine. Some of the schemes provided by them are:
- National Programme for Dairy Development (NPDD)
- National Dairy Plan (Phase-I)
- Dairy Entrepreneurship Development Scheme (DEDS)
- Support to Dairy Cooperatives
- Dairy Processing and Infrastructure Development Fund (DIDF)
MUDRA Scheme:
The micro enterprises supporting MUDRA is another platform to avail financial aid to set up and develop your animal husbandry venture. One can avail loans of up to Rs. 10 Lakhs, under the MUDRA scheme, through designated banks.
This loan can be used for the set up and development of activities of animal husbandry like pisciculture, bee keeping, poultry, livestock, rearing, diary and fishery
Apart from these direct schemes, various public and private sector banks offer various schemes to aid the animal husbandry business.
State Bank of India :
Being the largest banking financial institution in the country, SBI acts as the agency for various schemes introduced by the government for the farm sector.
SBI has the following loan products relating to animal husbandry –
- Poultry loan – loan for construction of poultry shed, feed room and other equipment.
- Dairy loan – provided to dairy societies for construction, expansion or modernization of dairy farming infrastructure.
- Fisheries loan – offered to farmers and fishermen to buy fish seeds, fishing nets and other equipment.
Syndicate Bank :
This bank has a scheme called animal husbandry scheme. Under this scheme, the bank extends medium term composite loans for dairy farming, poultry farming, pig rearing, fishing and similar activities.
Vijaya Bank :
The bank has established a scheme for financing animal husbandry, in which financial aid is offered to meet capital expenditure and working capital requirement for Dairy, Piggery, Poultry, Goat/Sheep rearing, Fisheries and Sericulture.
IDBI Bank :
The bank offers special loans for agricultural and
allied activities. They have loan schemes such as IDBI dairy loans, poultry
farming loans, loans for sheep & goat rearing, fisheries, sericulture and
beekeeping.
Bank of Baroda :
Financing Development of Dairy, Poultry, Fisheries, etc; - under this scheme, one can avail loan for activities allied to animal husbandry, viz,
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Capital and working capital requirements for dairy, piggery, poultry, sericulture, Sheep, goat & camel rearing units
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Construction of animal sheds, piggery, poultry sheds and supporting infrastructure
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Purchase of quality breed animals & chicks
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Purchase of feed, equipment and machinery
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Purchase of transport vehicle
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Labour and marketing expenditure
Terms & conditions of Animal Husbandry loans:
Generally, 75% - 85% of the project cost is offered as loan. Loan of up to 100% can be availed based on the applicant’s profile. The minimum loan amount offered is Rs.50000 and the maximum is up to Rs. 2 crores
The loan has longer repayment tenure compared to other business loans. The prevailing repayment tenure ranges between 3 years to 10 years
These loans have lower interest rates. The prevailing interest rate is between 10.20% - 12.50%. The final interest rate is based on the applicant’s profile.
For lower loan amounts, hypothecation of the asset serves as security. For larger amounts, the bank may require mortgage of land or building as collateral
Agriculture is the primary occupation in India. Animal husbandry is an allied activity of farming, that provides additional income to our farmers. There are numerous schemes available to support animal husbandry. Only a few have been mentioned above. One can contact their nearest bank branch or any other agriculture development authority to obtain more information on the available schemes and benefits.
This article has been written by CS Tanuj Chandra Saxenaa (ACS, M.COM, MBA (FINANCE), CFI (FMVA) (Pursuing) SAP FICO Certified. He is a Practicing Company Secretary and Trademark Agent in Tanuj Saxena & Associates in Lucknow, Uttar Pradesh.