Nabard chief sees FY25 farm credit offtake to Rs. 27 lakh crore

Agriculture credit growth this financial year is likely to be more than 13 per cent, reaching Rs 27-28 trillion, said National Bank for Agriculture and Rural Development (NABARD) chairman Shaji KV, at a media interaction in New Delhi.

“Over the past decade, agricultural credit has consistently grown at an average rate of 13 per cent. In FY25, we anticipate reaching around Rs 27-28 trillion in agricultural credit, higher than growth rates in other sectors. Moreover, this growth reflects a more granular approach — the reliance on informal credit sources is declining significantly. This shift indicates a trend towards the formalisation of rural credit, which benefits rural communities. Accessing formal credit sources generally leads to lower interest rates, resulting in better margins for these individuals compared to relying on informal lenders,” said Shaji.

The government sets annual targets for ground-level credit (GLC) in the agriculture sector for scheduled commercial banks (SCBs), regional rural banks (RRBs), and rural cooperative banks (RCBs).

In FY24, Rs 25.1 trillion (provisional) has been disbursed, surpassing the target of Rs 20 trillion by 25 per cent.

 Highlighting the issues in credit growth, the Nabard chairman said farmers will need to present their records for credit growth, which requires proper know your customer (KYC) procedures linked to their agricultural activities. However, in some areas, the lack of accessible land records remains a barrier.