Patna: The Bihar government has signed an agreement with the National Bank for Agriculture and Rural Development (NABARD) to provide an additional 1% interest subsidy on agricultural loans in the 2025–26 financial year, a move aimed at easing credit costs for farmers and encouraging the adoption of modern farming practices.
The memorandum of understanding between the state’s agriculture department and NABARD will supplement the existing 3% interest subsidy offered by the central government. Under the scheme, eligible farmers will receive a total interest subsidy of 4% on agricultural production loans of up to Rs 3 lakh taken through Kisan Credit Cards from commercial banks, regional rural banks and cooperative banks.
The benefit will be available only to farmers who repay their loans within the stipulated period.
Announcing the initiative, agriculture minister Ram Kripal Yadav said the additional subsidy would reduce the interest burden on farmers and improve access to institutional credit. He said cheaper loans were expected to motivate farmers to invest in modern agricultural techniques and inputs.
Officials said the scheme would enable higher spending on essentials such as seeds, fertilisers, pesticides and irrigation, and help boost production and farm incomes across the state.
NABARD will act as the nodal agency for implementation. Senior officials from both the agriculture department and NABARD were present at the signing of the agreement.
The state government has allocated Rs 5 crore for the scheme in 2025–26. Officials said the measure was expected to strengthen Bihar’s agricultural economy by expanding access to affordable credit and supporting investment in the sector.
