RBI advises the banks to convert the existing Short Term Crop Loans into KCC loans by June 30, 2020

Apr 02, 2020 | by Avantis RegTech Legal Research Team


Finance & Taxation Compliance

The Reserve Bank of India (RBI) on March 31, 2020, has extended all Short Term Crop Loans eligible for Interest Subvention (IS) and Prompt Repayment Incentive (PRI) benefit till June 30, 2020 due to the complete lockdown in every states due to COVID-19 pandemic. RBI vide Circular FIDD.CO.FSD.BC.No.1785/05.02.001/2019-20 dated February 26, 2020, had advised banks to ensure that all Short Term Crop Loans eligible for IS and PRI benefit are extended only through KCC with effect from April 01, 2020 and the existing Short Term Crop Loans which are not extended through KCC shall be converted to KCC loans by March 31, 2020.

However, due to the sudden breakdown of COVID-19 pandemic, RBI has decided that the banks may convert the existing Short Term Crop Loans including agriculture gold loans into KCC loans by June 30, 2020.

[Notification No. FIDD.CO.FSD.BC.No.23/05.02.001/2019-20]


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