What is Agriculture Infrastructure Fund (AIF) Scheme?

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About Agriculture Infrastructure Fund (AIF) Scheme:

It is a Central Sector Scheme which was launched in 2020.
Objective: The scheme shall provide a medium- to long-term debt financing facility for investment in viable projects for post-harvest management infrastructure and community farming assets through interest subvention and financial support.
The duration of the Scheme shall be from FY2020 to FY2032 (10 years).
Who are eligible?
- Primary Agricultural Credit Societies (PACS)
- Marketing Cooperative Societies
- Farmer Producers Organizations (FPOs)
- Farmers
- Self Help Group (SHG)
- Joint Liability Groups (JLG)
- Multipurpose Cooperative Societies
- Agri-entrepreneurs and Startups
- Central/State agency or Local Body sponsored Public-Private Partnership Projects.
Exclusions: Public Sector Undertakings (PSU’s) are directly not eligible under the scheme, but projects sponsored by the munder PPP are eligible.
All scheduled commercial banks, scheduled cooperative banks, Regional Rural Banks (RRBs), Small Finance Banks, Non-Banking Financial Companies (NBFCs), and National Cooperative Development Corporation (NCDC) may participate to provide this financing facility.
If required, need-based refinance support will be made available by NABARDto all eligible lending entities, including cooperative banks and RRBs, as per its policy.
Features:
- All loans up to a limit of ₹ 2 crores under this financing facility will have interest subvention of 3% per annum. This subvention will be available for a maximum period of 7 years.
- An applicant can put up to 25 projects in different locations, and each of such projects will be eligible under the scheme for a loan upto ₹ 2 crore.
- This limit of 25 projects is applicable to private sector entities, such as farmers, Agri entrepreneurs, and start-ups.
- This limitation of 25 projects will not be applicable to state agencies, cooperatives, national and state federations of cooperatives, FPOs, federations of FPOs, SHGs, and federations of SHGs.
- Multiple projects in one location are also eligible with an overall cap of ₹2 crore.
- Under the scheme, it is mandatory for borrowers to contribute at least 10% of total project cost, irrespective of available capital subsidy.
- The moratorium for repayment under this financing facility may vary, subject to a minimum of 6 months and a maximum of 2 years.
- 24% of total grants–in–aid under the scheme should be utilized for SC/ST entrepreneurs (16% for SC and 8% for ST).
- Besides this, lending institutions would ensure adequate coverage of entrepreneurs belonging to women, and other weaker segments of society may be provided loans on a priority basis.
- Credit guarantee coverage will be available for eligible borrowers from this financing facility under the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) scheme for a loan up to Rs. 2 crores. The fee for this coverage will be paid by the Government.
- In the case of FPOs, the credit guarantee may be availed from the facility created under the FPO promotion scheme of the Department of Agriculture, Cooperation & Farmers Welfare (DACFW).