SBI Agriculture Loan - Scheme For Dairy Societies And Dairy Units
SBI Has two bank loan schemes for Dairy related agricultural projects. The first one named -SBI Scheme For Dairy Societies- aims to provide finance for creating infrastructure like Construction of Milk house or Society office, Purchase of Automatic milk collection system, transport vehicles, Bulk chilling unit; and the second named SBI Dairy Plus Agriculture loan scheme to finance milk producing members of AMUL (link is external) pattern societies recognized private milk dairies posting profit in the past two years.
1. SBI Agriculture loan scheme for Financing Dairy Societies
SBI (link is external) Scheme For Dairy Societies aims to provide finance for creating infrastructure like Construction of “milk house or society office”, Purchase of “Automatic milk collection system”, transport vehicles, Bulk chilling unit.
Loan Eligibility for Dairy Societies
Society should have ‘A’ grade milk societies – registered & affiliated to district milk union, no adverse remarks in the audit report of previous 2 years, supplying 1000 lit/day to milk union, audited balance sheet for at least previous 2 years, earning pre-tax profits for the last two years, borrowing powers as per bye-laws of the Society.
Classification of Loan for Dairy Societies
Included in Indirect agriculture finance and/or Agricultural term loan (ATL).
Limit of Loan for Dairy Societies
Maximum - 4 times the average profit of previous 2 years maximum Rs 10.00 lacs. Milk house or society office Rs. 2 lakh, Automatic milk collection system Rs. 1 lakh, Milk transportation Rs. 3 lakh, Chilling Unit Rs. 4 lakh.
Margin of Loan for Dairy Societies
Margin money shall be 15% of the total loan amount
As applicable to ATL.
DSCR: Min. 1.75
- Primary: Hypothecation of assets.
- Collateral: Mortgage of landed property (or) Guarantee of milk union. Letter of undertaking from milk union to deduct and pay bank the amount till liquidation of loan.
Repayable in 5 years with a gestation of 6 months, with monthly instalments.
2. SBI Agriculture Loan Scheme for Financing Dairy Units (Dairy Plus)
SBI Dairy Plus Agriculture loan scheme to finance milk producing members of AMUL (link is external) pattern societies recognized private milk dairies posting profit in the past two years.
Purpose of SBI Dairy Plus Agriculture loan scheme
Construction of dairy shed Purchase of quality milch animals, milking machine, chaff cutter or any other equipment required for the purpose.
Eligibility for SBI Dairy Plus Agriculture loan scheme
Individual member of Amul Type society, age below 65 years with min. Individual Dairy < 10 animals min 0.25 acre land per 5 animals for growing feed & able to procure balance locally, > 10 animals 1 acre own or lease land per 5 animals.
Limit of SBI Dairy Plus Agriculture loan scheme
A Term loan of Maximum Rs.5 lacs. A working capital @ Rs.2500/- per animal per year may be sanctioned. Min DSCR: 1.75.
Margin of SBI Dairy Plus Agriculture loan scheme
Loans upto Rs. 50,000/- : Nil. Loans above Rs. 50,000/- and upto Rs.5 lacs: 10%
- Primary: hypothecation of assets.
- Collateral: upto Rs. 1.00 lac : Nil. Over Rs.1 lac - Mortgage of landed property (or) third party guarantee worth for loan amount (or) group guarantee of other 2 dairy farmers.
Repayment of SBI Dairy Plus Agriculture loan scheme
5 Years in monthly instalments with Gestation period – 6 months.
Rate of interest of SBI Dairy Plus Agriculture loan scheme
As applicable to direct agricultural loans (ATL).
Minimum yield criteria: Buffaloes – 7 lit/day (lactation average) Cow – 8 lit/day (lactation average). Fodder cultivation can be financed as per scale of finance. Payment to the bank directly by the society. Milk union operation & milk route facility are essential.
- Farmers, individual entrepreneurs, NGOs, companies ,pensioners, groups of
- unorgainsed and organized sector etc. including self help groups, dairy cooperative societies, milk unions , milk federations etc.
- An individual will be eligible to avail assistance for all the components under the scheme but only once for each component
- More than one member of a family can be assisted under the scheme provided they set up separate units with separate infrastructure at different locations. The distance between the boundaries of two such farms should be at least 500m.
- Entrepreneur contribution ( margin) – 10 % of the outlay ( minimum)
- Back ended capital subsidy –25% for general and 33% for SC/ST.
- Effective Bank Loan – Balance portion, Minimum of 40% of the outlay
- Repayment Period will depend on the nature of activity and cash flow and will vary between 3- 7 years. Grace period 3 to 6 months in case of dairy farms and upto 3 years for calf rearing units.
How to apply
Approach the nearest Veterinary Assistant Surgeon, Block Veterinary Officer
or the Chief Animal Husbandry Officer of the concerned District along with :
- Affidavit of being unemployed and not a defaulter of any bank or financial institutions
- Photocopy of Ration card/State Subject
- Land papers for mortgage if loan amount exceeds Rs.1.00 lacs
- Photocopy of category certificate if any.
- Three passport size photographs
- Copy of driving license if the unit is Refrigerated vehicle
- Degree certificate of BVSc&AH in case of Mobile/Stationery Vet. Clinic.
Components which can be funded:-
- Establishment of small dairy units with crossbreed cows/graded buffaloes up to 10 animals = Rs. 5.00 lac for 10 animal’s( minimum unit size is 2 animals and Maximum 10 animals)
- Rearing of heifer calves crossbreed/ graded buffaloes- up to 20 calves = Rs. 4.80 lac for 20 calf unit (minimum unit size 5 calves and Maximum 20 calves).
- Vermi-compost (to be considered with milch animals and not separately) = Rs. 20,000/-
- Purchase of milking machines/ milkotesters/ bulk milk cooling units ( up to 2000 litre capacity) = Rs: 18 lac
- Purchase of dairy processing equipment for manufacturing of indigenous milk products = Rs: 12 lac
- Establishment of dairy product transportation facilities and cold chain = Rs: 24 lac
- Cold storage facilities for milk and milk products. = Rs: 30 lac
- Establishment of private veterinary clinics = Rs: 2.4 lac for mobile clinic and Rs. 1.80 lac for stationary clinic
- Dairy marketing outlet/dairy parlour = Rs: 56,000/-