The Dharwad-based Karnataka Vikas Grameena Bank - a regional rural bank sponsored by Syndicate Bank - has reduced interest rates to 7 per cent on crop loans up to Rs 3 lakh.
This decision was taken in the interest of farming community, as low interest rates will encourage farmers to avail of loans and increase the crop production. This will lead to increase in their earnings.
It is estimated that around 1.5 lakh farmers will avail of this facility. It is planning to disburse Rs 1,100 crore during the current fiscal. Of this, Rs 566 crore has been earmarked for agriculture sector.
During 2005-06, the bank disbursed Rs 435.71 crore to agriculture sector.
The new rate will be made applicable with effect from April 1 for its customers in Dharwad, Gadag, Haveri, Belgaum, Bijapur, Bagalkot, Uttara Kannada, Udupi and Dakshina Kannada districts.