Agriculture loans: What are the types available?
30 Mar 2026

Agriculture loans are a lifeline for farmers in India, enabling them to fund their farming activities and manage expenses.

These loans are tailored to meet the diverse needs of farmers, be it for purchasing seeds, fertilizers, or equipment.

Knowing the different types of agriculture loans can help you make informed financial decisions.

Here are five types of agriculture loans that can help you grow.

Crop loan for short-term needs
#1

Crop loans are short-term loans given to farmers to meet immediate expenses, such as buying seeds, fertilizers, and pesticides.

These loans are usually repaid after the harvest season when the farmer sells their produce.

The interest rates on crop loans are usually lower than those on other types of loans, making them an attractive option for short-term financing needs.

Agricultural term loan for long-term investment
#2

Agricultural term loans are long-term loans meant for capital investments, such as purchasing tractors or other machinery.

The repayment period of these loans is longer, generally extending from three to five years.

Although the interest rates may be higher than those of crop loans, they are still reasonable, considering the duration and purpose of the loan.

NABARD financing for rural development
#3

The National Bank for Agriculture and Rural Development (NABARD) offers financial support to rural development projects through specialized agriculture loans.

These include funding for irrigation projects, rural infrastructure development, and self-help groups.

NABARD's initiatives aim to improve rural livelihoods and boost agricultural productivity across India.

Kisan Credit Card for flexible funding
#4

The Kisan Credit Card (KCC) scheme provides farmers with a credit card facility that offers flexible funding options at affordable interest rates.

With a KCC, farmers can withdraw cash as per their requirement within the sanctioned limit, without having to apply for a new loan each time they need funds.

Microfinance institutions supporting small farmers
#5

Microfinance institutions (MFIs) are instrumental in providing small-scale agriculture loans to marginal farmers who may not qualify for traditional bank financing due to lack of collateral or credit history.

MFIs offer smaller loan amounts, with simpler application processes, and more lenient eligibility criteria, thus empowering small farmers with access to necessary capital for their farming activities.