Ministry of Agriculture presented a 5% loan mechanism for farmers

The Ministry of Agriculture offers to agricultural producers a preferential credit rate – up to 5% per annum or less by subsidizing, according to the draft government resolution published on a website of regulatory legal acts drafts.
“The updated credit facility involves the transition to a system in which the interest rate for agricultural producers initially will not exceed 5% per annum. The subsidy itself will be transferred directly to the authorized banks to compensate for falling revenues, “- the document says.

The Ministry of Agriculture reminds that the practice of compensations to banks is used in issuing concessional auto loans or loans for education. The Ministry points out that the new mechanism of state support will allow the agricultural producers not to detract own operating funds for the subsidized portion of the interest rate and not to wait for their subsequent return in the form of grants, as is the case under the current system. The new rules provide for “preferential short-term loan” – borrowed funds in the amount of not more than 1 billion rubles for a period of up to one year for the purposes of crop, livestock and dairy farming, in accordance with the list of the Ministry of Agriculture, as well as “preferential investment loan” – no more than 10 billion rubles for a term of two to eight years (for the construction and reconstruction of storages, greenhouse complexes, livestock facilities and farms), or from two to fifteen years (for development of meat and dairy cattle breeding, purchase of cattle, reconstruction and modernization of farms, livestock facilities, slaughterhouses, meat and dairy products acceptance and storage points). The resolution will be implemented within the framework of agricultural sub-program for financial and credit system of the agricultural development state programme and regulation of agricultural products, raw materials and food markets for 2013-2020.
Source: Milknews