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Guidelines for relief measures to farmers affected by natural calamities - Conversion of ST(SAO) loans into Medium Term loans - Refinance Policy for F.Y. 2020-21
 
1.  Please refer to our circular No. 91/DoR-31/2019 dated 01 April 2019 communicating the refinance policy for conversion of short-term agricultural loans into medium term loans and rephasement / reschedulement of existing MT (conversion) loans for the year F. Y. 2019-20. This line of credit which envisages providing relief to farmers, whose crops have been damaged, due to natural calamities has since been reviewed and it has been decided to continue broadly, with the same policy for the year 2020-21. 
 
2.   The eligibility of Cooperative Banks for sanction of credit limit, for conversion of ST (SAO) loans into medium term loans is linked to compliance with the CRAR norms. Refinance will be available to all licensed StCBs/ CCBs with CRAR conditions mentioned below:
a) Only such StCBs having CRAR of 9% and above, on behalf of DCCBs with CRAR of 9% and above (as on 31.03.2019),
b) In case of StCBs with CRAR more than 9%, but individual DCCBs with CRAR less than 9% as on 31.03.2019, no refinance will be available on behalf of such DCCBs.
 
3.   The rate of interest on refinance on MT conversion / rephasement / reschedulement of loans for F. Y. 2020-21 will be 300 basis points below that charged by Banks to the ultimate beneficiaries subject to a minimum interest rate of 8.10% p.a. or as decided by NABARD from time to time. The rate of interest charged by the banks would be as per the RBI guidelines.
 
4.  Other terms and conditions remain unchanged
 
5.  The contents of this circular may be brought to the notice of Controlling Office of CCBs working under your jurisdiction.
 
6.  Please acknowledge receipt of this circular to our Regional Office.