Purchase of Land for Agricultural Purpose

Target Group & Eligibility: Small and Marginal Farmers, share croppers and tenant farmers. Small and Marginal Farmers are those who would own maximum of 5 acres of non-irrigated land or 2.5 acres of irrigated land including the one to be purchases under the scheme.


  • To make the small and marginal holdings economically viable by bringing fallow lands and waste lands under cultivation and by stepping up agricultural production and productivity.
  • To finance the share croppers / tenant farmers to purchase land to enable them to increase their income

Loan Amount:

  • Minimum : Rs. 25,000.00
  • Maximum : Rs. 5,00,000.00

Project Cost Consists of:

  1. Purchase price of land
  2. Value of stamp duty and registration charges
  3. Development expenses towards land to be purchased

Other Conditions: Land proposed to be purchased should be utilized for agricultural and allied agricultural purpose and that incremental income generated should be adequate to meet repayment obligation for the proposed loan.

Margin: Minimum 5% of Total Project Cost

Repayment Period: Repayment will be quarterly/half-yearly/yearly basis depending on income generation of the scheme. Maximum repayment period should be 7 years to 9 years including the grace period.

Moratorium Period: Maximum 2 years or 24 months.

Rate of Interest: As per Bank’s prevailing rate of interest at the time of sanction and is subject to change from time to time.

Periodicity for Application of Interest: Bank will charge interest at annual rests. However bank may take into consideration due dates fixed on the basis if income generation and harvesting/marketing season while charging interest and compounding the same if the loan installment becomes overdue.


  • Loan up to Rs. 100,000/- : Equitable Mortgage of land purchased out of Bank loan.
  • Loan above Rs. 100,000/- : In addition to Equitable Mortgage of land, other collateral security in the form of Lien on deposits/ mortgage of land and landed property, third party guarantee etc.

Processing Fees: No processing fees on loans for purchase of land for agricultural purpose

Prepayment Charges: No Pre-Closure/Pre-payment penalty for this loan.