NABARD slashes refinance rate by 0.20% to boost farm investment

National Bank for Agriculture and Rural Development (NABARD) reduced refinance rate for banks and other lending agencies by 0.20 % to promote rural credit and rural infrastructure.

Revised rates: The revised rate of interest on refinance for a period of five years for commercial, state cooperative, regional rural and primary urban cooperative banks will be 9.70%, down from 9.90%. The new rates are effective from January 7.

Relaxation:

  • If banks draw refinance of Rs. 500 crore and more in a single drawl, they will be allowed additional reduction of 0.10% and will make effective rate 9.60 %.
  • For State Cooperative Agriculture and Rural Development Banks (SCRDBs), a 10 basis point reduction is allowed for a single drawl of Rs. 200 crore and above.

These measures are expected to give a boost to banks for extending investment credit and creation of much-needed warehousing infrastructure for agricultural commodities in the country.

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Categories: Banking Current Affairs 2017

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